Osaka City Business Subsidies and Loans 2026 — The Strong Suits Are "Loans" and "Energy Savings"
Osaka City's business support isn't the type lined with small cash subsidies like Tokyo's 23 wards. Its two pillars are low-interest institutional loans and subsidies for energy-saving and energy-generating equipment, layered with Osaka Prefecture's loans and wage-increase support. Because Osaka is a government-designated city, businesses can use both prefectural and municipal programs — a strength, but also the reason it's confusing which counter to go to. This article sorts things into three layers — national, prefectural, and municipal — and covers actual amounts as well as the accounting and tax treatment after you receive the money.
First, the Big Picture — Think in Three Layers: National, Prefectural, and Municipal
Startup funds come from the prefecture's "Business Startup Support Fund", while equipment investment comes from the city's "Equipment Investment Support Loan" — that's the basic split. The city's Equipment Investment Support Loan is built to shave an additional 0.2 points off the prefectural institutional loan's rate, so if you have a place of business within Osaka City, going through the city counter is always more advantageous.
Institutional Loans — Two City Programs and the Prefectural Menu
Osaka City's Institutional Loans
| Program | Loan cap | Interest rate & guarantee fee | Requirements |
|---|---|---|---|
| Equipment Investment Support Loan | ¥200,000,000 (unsecured portion ¥80,000,000) | 1.25% or less/year (fixed) Guarantee fee 0.7%/year | SMEs with an office in the city and a record of paying municipal tax. For equipment investment to strengthen the business (general type), or those certified under a Business Improvement Plan, Advanced Equipment Introduction Plan, etc. (certified-plan type) |
| Special Management Support Loan | ¥20,000,000 | 1.65%/year (fixed) Guarantee fee 0.5–2.2%/year | Has a business location in the city, has continued the same business for roughly one year or more, has a record of paying municipal tax, and sales over the most recent 3 or 6 months have fallen year-on-year |
How much does a 0.2-point difference mean? Borrowing ¥30,000,000 for equipment over 7 years
Osaka Prefecture's Challenge Support Fund (assuming 1.45%/year): interest comes to roughly ¥1,590,000
Osaka City's Equipment Investment Support Loan (1.25%/year): interest comes to roughly ¥1,370,000
→ The difference is about ¥220,000. Since all it takes is going through the city's counter once, there's no reason for a business inside the city not to use it.
Osaka Prefecture's Institutional Loans (consider alongside the city's programs)
| Fund | Loan cap | Interest rate & guarantee fee | Eligibility |
|---|---|---|---|
| Business Startup Support Fund | ¥35,000,000 | 1.65%/year 1.45% for women, young people, seniors, and U/I/J-turn entrants Guarantee fee 1.0–1.2% | From before startup to less than 5 years after starting. Own capital must be at least one-tenth of the funds needed to start the business |
| Same fund, Regional Support Network type | ¥35,000,000 | 1.45%/year (1.25% with preferential treatment) Guarantee fee 0.5–0.7% | From before startup to less than 1 year after starting. Conditional on receiving three years of follow-up support from a financial institution or chamber of commerce after the loan |
| Challenge Support Fund | ¥200,000,000 (unsecured portion ¥80,000,000) | Roughly 1.65–1.85%/year | SMEs working on management innovation, equipment investment, business succession, digitalization, decarbonization, etc. Has sub-categories by purpose |
| Small Business Support Fund | ¥20,000,000 | — | 20 or fewer employees (5 or fewer for some commercial/service businesses) |
| Business Stability Support Fund | ¥200,000,000 | — | For cases such as a business partner's bankruptcy or a struggling industry. Requires the mayor's Safety Net certification as a prerequisite |
Osaka Prefecture's institutional loans saw their fixed-rate menus raised uniformly by 0.25 points effective April 1, 2026. Don't trust the rates in articles or materials from 2025 or earlier. For businesses that had been postponing equipment investment, the longer they wait, the more they lose out — and that trend continues.
Osaka Prefecture's Equipment Investment Support Loan Promotion Project (started May 11, 2026) subsidizes half of the credit guarantee fee for SMEs that use programs such as the equipment-investment type of the Challenge Support Fund while also working on wage increases. If you're planning equipment investment and wage increases together, your guarantee-fee burden is effectively cut in half.
Energy Savings and Solar — Osaka City's Largest-Amount Category
| Program | Subsidy rate & cap | Key points |
|---|---|---|
| Solar Power Installation Subsidy July 8 – October 30, 2026 | ¥80,000/kW (cap ¥20,000,000) | Solar carports. Effective for businesses with parking lots |
| 1/5 of costs (cap ¥12,500,000) | Building-integrated (window) | |
| 1/4 of costs (cap ¥7,500,000) | Building-integrated (wall) | |
| ¥25,000/kWh (cap ¥10,000,000) | Storage battery installed alongside. ¥35,000/kWh for residential systems under 10kW | |
| Energy-Saving/CO2 Reduction Acceleration Support (diagnosis) | 10/10 of self-pay cost (cap ¥50,000) | Makes the cost of an energy-saving diagnosis effectively free. Applications opened August 10, 2026 |
| Same program (equipment upgrade) | 1/3 of costs (cap ¥3,000,000) | Requires that you have already received a grant decision under the national Energy-Saving Investment Promotion Support Project (equipment-unit type, utility equipment). Cannot be applied for through the city alone |
Osaka City's Solar Power Installation Subsidy requires that you have received indirect national support in the same fiscal year. In other words, the order is "apply to and be selected by the national program, then apply to the city" — applying to the city alone will not work. The energy-saving equipment upgrade subsidy has the same structure. You need to work backward from the national program's application schedule, so this is a difficult program to catch up on once you've already decided to apply.
Digitalization, New Product Development, and Wage-Increase Subsidies (fiscal 2026 track record)
| Program | Subsidy rate & cap | Fiscal 2026 status |
|---|---|---|
| Osaka City On-Site Smart Technology Subsidy (Second Round) | 1/2, cap ¥3,000,000 | August 19 – September 30, 2026. First-come, first-served; closes once the budget is used up. About 3 grants planned |
| Osaka City New Product/Service Development Support Subsidy | 1/2, cap ¥5,000,000 | Closed (April 15 – June 24, 2026). About 5 grants awarded |
| Osaka Prefecture Profit Margin Improvement and Wage Increase Support Subsidy | 2/3, cap ¥5,000,000 | Closed (through June 26, 2026). 737 grants awarded out of 2,508 applications. Conditional on declaring a total wage increase of 2.0% or more |
| Osaka Prefecture Business Improvement and Wage Increase Promotion Subsidy | 1/4, cap ¥2,000,000 | Pre-registration ran September 1–30, 2026, and has closed. If already registered, grant applications run December 1, 2026 – March 10, 2027. Conditional on raising wages more than 2% above the minimum wage |
| Osaka Prefecture Exhibition/Trade Show Participation Support | 2/3, ¥100,000–¥2,000,000 | Closed early once its budget was reached (August 12, 2026). Covers trade shows held through February 8, 2027 |
| Osaka Prefecture Overseas Patent Application Support | 1/2, cap ¥3,000,000 | Closed (through June 19, 2026). ¥1,500,000 for patents, ¥600,000 for designs and trademarks, etc. |
| Osaka Prefecture Skill-Up Support Grant | 3/4 for transport, construction, and digital fields (no cap) 1/2, cap ¥200,000 for other fields | Accepting applications through March 10, 2027. Support for external training costs, applied for by the employee personally |
The prefecture's Profit Margin Improvement and Wage Increase Support Subsidy awarded 737 grants out of 2,508 applications. That's a competition ratio of about 3.4x — put another way, roughly 30% get through, so this isn't a lottery. The bar is one where solid documentation makes a real difference, so if a similar call for applications comes up in fiscal 2027, it's worth preparing your business plan in advance.
Looking at the table above, most of the larger subsidies had already closed their applications by April through August. The trade-show subsidy even closed early, before its deadline, once its budget was reached. Unlike Tokyo's 23 wards, where second or third rounds often come around in fall or winter, few programs here do that — so the basic strategy in Osaka is to decide what you're applying for before the fiscal year even starts.
If You're Starting a Business — Certificates and Incubation
Osaka City's Specified Business Startup Support Program issues a certificate (taking about 10 days to issue) once you complete, in principle, 4 or more sessions over a total of at least one month at a startup school such as the Osaka Industrial Creation Center's "Startup Challenge Seminar" or "Akinai Toranoana," the Osaka Design Promotion Plaza, or one run by the Osaka Chamber of Commerce and Industry[Osaka City (in Japanese)].
- Registration and license tax for incorporating is cut in half (0.7% → 0.35% for a kabushiki kaisha; minimum ¥60,000 → ¥30,000 for a godo kaisha)
- A special unsecured, no-third-party-guarantor startup guarantee
- Preferential interest rates on startup loans from the Japan Finance Corporation
- Extra points in the national Sustainability Subsidy
Since September 2, 2024, eligibility has expanded to cover anyone who has already started a business as a company representative, as long as it's been less than 5 years since starting. If you'd given up thinking "I've already registered, so I can't use this," it's worth checking. For the overall picture of startup procedures, see our guide to starting a sole proprietorship; for deciding whether to incorporate, see timing your incorporation.
For consultations, contact the Osaka Industrial Creation Center's Business Consultation Office (06-6264-9838, weekdays 9:00 AM–5:30 PM); dispatching an expert is also free. For business succession, the Osaka Prefecture Business Succession Support Center (06-6944-6257), inside the Osaka Chamber of Commerce and Industry, is your point of contact.
Don't Overlook the Support That Isn't Cash
- Mayor's certification for Safety Net Guarantee (categories 1–8) — Gives you a guarantee frame separate from the general guarantee. It's also a prerequisite for using the prefecture's Business Stability Support Fund, so if your business is struggling, start here. You can book an appointment online in advance.
- New Business Field Development Enterprise Certification (Venture Procurement System) — The mayor certifies SMEs making distinctive new products, and the city gives them priority in negotiated-contract procurement. This isn't a subsidy but support that "creates sales," so for tax purposes it's treated simply as ordinary revenue.
- Price Pass-Through Support — The prefecture dispatches experts for free to support you through price negotiations (starting June 19, 2026). For businesses that haven't yet passed on rising material and labor costs.
[Most Important] Accounting and Taxes After Receiving a Subsidy
This is the main point. Because Osaka City's support leans toward equipment subsidies and loans, the key tax issues also concentrate on "reduction entry" and the "treatment of interest and guarantee fees."
① Corporate and Income Tax — Solar and Energy-Saving Equipment Are the Prime Candidates for Reduction Entry
In principle, a subsidy is included in gross profit (gross revenue, for a sole proprietor) for the fiscal year in which it's received. However, the portion used to acquire fixed assets can have its taxation deferred through reduction entry (Articles 42–44 of the Corporation Tax Act). The Solar Power Installation Subsidy and the energy-saving equipment upgrade subsidy are textbook examples of this.
What happens if you use reduction entry: receiving a ¥10,000,000 subsidy for a carport-type solar system
Without it: ¥10,000,000 becomes gross profit for that fiscal year. Assuming an effective corporate tax rate of about 30%, that year carries a tax burden of roughly ¥3,000,000 (equipment depreciation happens gradually over its statutory useful life).
With it: you reduce the book value by ¥10,000,000, offsetting that year's gross profit. That year's tax burden is zero, but depreciation expenses afterward become smaller, so the tax burden shifts to the future.
→ This isn't a tax exemption — it's a system that "defers payment." Even so, it prevents the cash-flow crunch that can happen when the subsidy payment and tax payment fall out of sync.
The requirements are: ① it's been determined that repayment is not required; ② the subsidy was used to acquire or improve a fixed asset; and ③ the required entries are made on the tax return. If the determination that repayment isn't required carries over into the following period, it's handled with a "special reserve account." Sole proprietors must attach the "Statement Concerning Non-Inclusion of National Subsidies, etc. in Gross Revenue" — forgetting this means you can't apply the treatment[National Tax Agency No. 2202 (in Japanese)].
② Consumption Tax — Out of Scope, but "Repayment" Can Occur
Receiving a subsidy is outside the scope of consumption tax (non-taxable). However, if you've claimed an input tax credit for the consumption tax included in the subsidized expenses, you may be asked to repay that portion. The rough guideline is 10/110 of the subsidy amount.
This applies only to taxable businesses using the general (principle) taxation method — businesses that have chosen the simplified taxation method, and tax-exempt businesses, are not affected. For a ¥10,000,000 subsidy, that's about ¥910,000 in play, so first check whether the grant guidelines require a "report on the consumption tax input deduction amount." If you're not sure which category you fall into, see the difference between simplified and principle taxation.
③ Treatment of Loans, Guarantee Fee Subsidies, and Training Costs
- Borrowed money is not income — Even if you borrow ¥200,000,000 through the Equipment Investment Support Loan, it isn't taxed. Interest paid is a deductible expense.
- Credit guarantee fee subsidies — When half of the guarantee fee is subsidized, as with the prefecture's Equipment Investment Support Loan Promotion Project, you record the subsidized amount as income. The guarantee fee itself, on the other hand, is in principle allocated as an expense (prepaid expense) over the guarantee period, so the timing of the income and the expense diverges. Be sure to check this at closing.
- The Skill-Up Support Grant is received by "the employee personally" — Since it isn't a subsidy to the company, it doesn't become the company's gross profit. However, if the company pays the training costs and the employee also receives the support grant, the accounting gets complicated, so decide in advance who is paying.
- Revenue from the Venture Procurement System — This is not a subsidy but ordinary revenue (a taxable transaction). It is not eligible for reduction entry.
How the Fiscal Year Moves — an Application Calendar
- Before the fiscal year begins (January–March): Since Osaka's major calls for applications cluster in the first half of the year, use this time to decide what to apply for and draft the outline of your business plan.
- April–June: The prefecture's wage-increase subsidies, the city's new product development support, and overseas patent application support. Miss this window and many programs mean a one-year wait.
- July–October: The city's Solar Power Installation Subsidy (through October 30), and the energy-saving diagnosis/equipment upgrade subsidies. Since these require a national grant decision first, work backward from the national program's schedule.
- September: Pre-registration for the prefecture's Business Improvement and Wage Increase Promotion Subsidy (a prerequisite for the grant application starting in December).
- Year-round: The city's two institutional loan programs, the prefecture's various funds, the Specified Business Startup Support Program, Safety Net certification, and free consultations at the Osaka Industrial Creation Center.
- At closing: Check reduction entry, the report on the consumption tax input deduction amount, and the recording of guarantee fee subsidies.
What to Do Today
- If you're considering equipment investment, get a quote through the city's Equipment Investment Support Loan (1.25% or less). It's 0.2 points cheaper than the prefectural program, a difference that can run into hundreds of thousands of yen
- If you're aiming for the energy-saving or solar subsidies, first check the national program's application schedule (the city's subsidy requires a national grant decision first)
- Book an appointment with the Osaka Industrial Creation Center's Business Consultation Office (06-6264-9838). Consultations and expert dispatch are both free, and it's also your entry point to the startup certificate
Frequently Asked Questions
Should I use Osaka City's or Osaka Prefecture's program?
For startup funds, Osaka Prefecture's "Business Startup Support Fund" (cap ¥35,000,000) is the basic choice; for equipment investment, Osaka City's "Equipment Investment Support Loan" (cap ¥200,000,000, 1.25% per year or less) is. The city's Equipment Investment Support Loan is designed to shave an additional 0.2 points off the prefectural loan's rate, so if you have a business location within Osaka City, going through the city is more advantageous.
Why is Osaka Prefecture's institutional loan interest rate different from before?
Because its fixed-rate menus were raised uniformly by 0.25 points effective April 1, 2026. Rates listed in materials from 2025 or earlier no longer apply. Before applying, always check the latest fiscal 2026 institutional loan guide.
Can I just apply to the city for the solar power subsidy?
No. Osaka City's Solar Power Installation Subsidy requires that you have received indirect national support in the same fiscal year. The energy-saving equipment upgrade subsidy likewise requires a grant decision under the national Energy-Saving Investment Promotion Support Project. Since you apply to and are selected by the national program before applying to the city, you need to work backward from the national program's schedule.
When should I apply for Osaka's subsidies?
In the first half of the fiscal year. In fiscal 2026, the prefecture's wage-increase support closed on June 26, the city's new product development support closed on June 24, and the prefecture's trade-show support closed early on August 12 once its budget was reached. Since few programs here run a second round in fall like Tokyo's 23 wards do, it's realistic to decide what to apply for and prepare before the fiscal year even starts.
Is a subsidy I receive taxed?
In principle, yes — it's included in gross profit (gross revenue, for a sole proprietor) for the year received and taxed. When you use it to acquire a fixed asset, such as solar or energy-saving equipment, you can defer taxation through reduction entry, conditional on things like the repayment obligation being confirmed as waived. It's not a tax exemption but a deferral, and sole proprietors must attach a statement to their tax return.
Is money I receive as a loan taxed?
No. Borrowed money isn't income, so it doesn't count toward gross profit or gross revenue, and interest paid is a deductible expense. However, if you receive a credit guarantee fee subsidy, that subsidized amount must be recorded as income. Since the guarantee fee itself is, in principle, allocated as an expense over the guarantee period, watch for the timing mismatch.
References (Sources)
This article was prepared by checking the following publicly available materials. Interest rates, remaining budgets, and application status can change mid-year, so please always check the latest official information before applying.
- Osaka City: Equipment Investment Support Loan (in Japanese)
- Osaka City: Special Management Support Loan (in Japanese)
- Osaka City: Fiscal 2026 Solar Power Installation Subsidy (in Japanese)
- Osaka City: SME Energy-Saving/CO2 Reduction Acceleration Support Subsidy (in Japanese)
- Osaka City: Specified Business Startup Support Program (in Japanese)
- Osaka Prefecture: Fiscal 2026 Institutional Loans (in Japanese)
- Osaka Prefecture: Business Startup Support Fund (in Japanese)
- Osaka Prefecture: Business Improvement and Wage Increase Promotion Subsidy (in Japanese)
- National Tax Agency No. 2202: Receiving National Subsidies, etc. (in Japanese)
- National Tax Agency: Corporation Tax Basic Directive, Chapter 10 Section 2 — Reduction Entry for Assets Acquired with National Subsidies, etc. (in Japanese)
※This article provides general information and does not guarantee individual tax or administrative-procedure judgments. Whether reduction entry applies and the amount of any consumption tax repayment depend on the subsidy's grant guidelines and your own taxation method. Please confirm specific treatment with your tax accountant or tax office.
