Stocks investment outside of NISA

[Kiyora999]

Hello everyone,
I max my NISA account (1,2m) and Ideco (23000 yens/month) every year since 4 years ago.
Since 2-3 years ago I started buying dividend stocks only on NISA.
2022 is my last NISA year and I plan to roll out every year from now on in the new NISA and invest the yearly 1,2 million (or more) in another account.

It’s better to go for a Tokutei account if I buy only dividend stocks right?
If my NISA is on SBI, should I go to another broker like Rakuten for the Tokutei to reduce risks?
Right now I just bought jp and US stocks because there are no EU stocks on sbi. I plan to buy some Singapore/South Korea/Chinese stocks etc from now on too for diversification.

I would like to setup the account in January and invest a little money there in 2022 too to try things out.
I have to declare in the year-end declaration for the Tokutei account only if: j
I resell stocks for more than 200k yens capital gains or get more than 200k dividends right? (That shouldn’t happen I do buy and hold only and I don’t think I could get more than 20000 yens in dividends in one year there)

Thanks in advance for your help!

[kansaifolk]

Hello Kiyora,
I am not sure I'm clear what you are asking exactly, but I also have an SBI account (NISA) and I also put in more than the allowed NISA allowance. So I just buy stocks or funds in the non-NISA account that is already existing within that same SBI account. Instead of clicking on NISA in the buying platform, you just click Tokutei 特定. My SBI portfolio page shows both my NISA account holdings and my outside-NISA holdings. The tokutei means that they withhold all the dividend tax or capital gains tax for you - so easy. If you click on "一般”, you would have to do all the tax stuff yourself at the end of the year.
There is no reduction in risk going to another brokerage to buy stocks or ETFs. The reduction in risk just comes from your stock and fund picks - funds are obviously safer as risk is spread out among various stocks. Saying that, I buy mainly stocks myself, all Japanese (for my accounts in Japan).

[adamu]

It’s better to go for a Tokutei account if I buy only dividend stocks right?

Depends what you mean by "better". Better than getting the dividends tax-free in a NISA? no.

But for the US stocks, you are paying 10% US withholding tax in the NISA that you can't claim back. So for those, it's better to keep them outside the NISA so you can claim back the US tax, and put the Japanese ones in the NISA where they will be 100% tax free and maximise the NISA protection.

There's also an argument to be made for putting funds that reinvest internally, rather than paying out dividends, in the NISA because then the value compounds over multiple years. With dividends, they are tax free, but once they're paid out, that's it. You have to consume more NISA allowance if you wanted to reinvest them. For funds that reinvest internally, this is not an issue.

If my NISA is on SBI, should I go to another broker like Rakuten for the Tokutei to reduce risks?

If a broker goes out of business, you could be stuck waiting years to get hold of your funds, so it makes sense to be invested with at least two brokers so you still have access to part of your investments in that case. The type of account is irrelevant, it's the company that provides the account that's important.

I have to declare in the year-end declaration for the Tokutei account only if: j
I resell stocks for more than 200k yens capital gains or get more than 200k dividends right?

No, the tokutei account handles the tax reporting, you don't have to declare anything.* But if you want to claim back the 10% US Witholding tax on dividends, then you need to declare them on your tax return (not nenmatsu chousei). I'm going to be working this out this year too.

*If it's a tokutei account without automatic tax collection, then maybe you need to declare. I'm unfamiliar with how that or the 200k allowance works. I should really learn more about it...