Junior NISA is tax free until the child is 18. Subsequent capital gains/dividends are taxed normally.Deep Blue wrote: ↑Mon Jun 27, 2022 11:02 am Thanks. It seems like that is an ok option if we choose to tie the money up in Japan. But won't CGT apply when they come to cash these investments in, 10, 20 or 30 years down the line? I would expect substantial capital growth by then (assuming 5% average annual investment returns) and then they'll be hit by 20% CGT?
Are accumulation investment vehicles a thing here? A class that automatically invests dividend income back into more units rather than paying out? And if they exist, do they avoid dividend tax?
Mutual funds in Japan often reinvest dividends internally. No dividends are paid and no tax is due. They are very tax-efficient. In a taxable account only 20% capital gains tax is due when selling, in NISA there is no tax due, and iDeCo is largely tax-free.
