Simple Q&A - Stock market investing

[TokyoBoglehead]

Answers:

1. Not American, fortunately.

2. Tax Withholding if I'm not mistaken. Based on the list you shared I guess my IBKR account in my home country isn't suitable.

Thanks.

You'll want a Japanese broker so you can invest tax-free with a NiSa or iDeco.

IBKR tends to require non-residents to close their accounts in some countries.

[Viralriver]

Quick question:

Let's say I buy 1 share on Rakuten in a tax withholding account. The share is $100 and at the time of purchase $1 = 120 JPY. The total cost therefore is 12,000 JPY. 2 years later the share price drops to $90. The exchange rate increases to $1 = 150 JPY. If I were to sell, I would get 90 * 150 = 13,500 JPY.

Even though the share price has gone down I would make money thanks to the exchange rate. Now my question is, am I taxed on the 1,500 JPY in my account, or something else?

Thanks!

[adamu]

Is there an option to actively day trade stocks and benefit from the tax free initiative?

You'll want a Japanese broker so you can invest tax-free with a NiSa or iDeco.

You can't do day trading in either of these accounts.

But then again, day trading is not really in the spirit of this forum; it's a bad idea for most people and distracts from the core message which is to focus on low cost index funds.

Small article on account types here:
https://retirewiki.jp/wiki/Securities_account_types

[adamu]

Quick question:

Let's say I buy 1 share on Rakuten in a tax withholding account. The share is $100 and at the time of purchase $1 = 120 JPY. The total cost therefore is 12,000 JPY. 2 years later the share price drops to $90. The exchange rate increases to $1 = 150 JPY. If I were to sell, I would get 90 * 150 = 13,500 JPY.

Even though the share price has gone down I would make money thanks to the exchange rate. Now my question is, am I taxed on the 1,500 JPY in my account, or something else?

You are taxed on the gain in yen-denominated asset value.

[TokyoBoglehead]

Is there an option to actively day trade stocks and benefit from the tax free initiative?

You'll want a Japanese broker so you can invest tax-free with a NiSa or iDeco.

You can't do day trading in either of these accounts.

But then again, day trading is not really in the spirit of this forum; it's a bad idea for most people and distracts from the core message which is to focus on low cost index funds.

Small article on account types here:
https://retirewiki.jp/wiki/Securities_account_types

Haha I completely misread *day trade*, as buy daily. I forgot people are out there selling daily too!

IBKR Japan would be the best be for him if IBKR wont let him trade through his home country account. They are currently not excepting new clients, as they are merging their two account classes (Japan/international).

[MBK]

I have one question about buying stock on 特定 account. I have already maxed out my NISA, but still have some funds available, so want to purchase the stock under 特定 account.

I have a confirmation in regards to capital gains. If I understand correctly, I will be obliged to pay capital gains tax of 20.3% on any profit generated from the stock after its sold.

I plan to purchase index funds and hold on to it for a while. I wanted to check if there is any procedure that I will need to do in regards to the stock with the yearly 確定申告 or basically do not need to worry about this stock until after selling it?

[TokyoWart]

I have one question about buying stock on 特定 account. I have already maxed out my NISA, but still have some funds available, so want to purchase the stock under 特定 account.

I have a confirmation in regards to capital gains. If I understand correctly, I will be obliged to pay capital gains tax of 20.3% on any profit generated from the stock after its sold.

I plan to purchase index funds and hold on to it for a while. I wanted to check if there is any procedure that I will need to do in regards to the stock with the yearly 確定申告 or basically do not need to worry about this stock until after selling it?

The advantage of using the tokutei account (with tax withholding) is that you don’t have to report anything on the kakuteishinkoku

[MBK]

I have one question about buying stock on 特定 account. I have already maxed out my NISA, but still have some funds available, so want to purchase the stock under 特定 account.

I have a confirmation in regards to capital gains. If I understand correctly, I will be obliged to pay capital gains tax of 20.3% on any profit generated from the stock after its sold.

I plan to purchase index funds and hold on to it for a while. I wanted to check if there is any procedure that I will need to do in regards to the stock with the yearly 確定申告 or basically do not need to worry about this stock until after selling it?

The advantage of using the tokutei account (with tax withholding) is that you don’t have to report anything on the kakuteishinkoku

Thank you for confirmation. So with purchases on tokutei accounts with tax withholding, the tax will be automatically charged on the profit from the stock sale after the sale is finalized, right?

[TokyoWart]

Thank you for confirmation. So with purchases on tokutei accounts with tax withholding, the tax will be automatically charged on the profit from the stock sale after the sale is finalized, right?

Yes, that’s my experience.

[adamu]

with purchases on tokutei accounts with tax withholding, the tax will be automatically charged on the profit from the stock sale after the sale is finalized, right?

Right. Same goes for dividends.