Given that Ideco does not get any employer contribution unlike kosei nenkin I think I would rather see pension allowances to be more generous than those available for NISA. This is the case in the UK where pension allowance is 40,000 pounds and ISA allowance is 20,000 pounds annually. There are very few areas where I think the UK does better than Japan. However, pension provision in the UK is defiantly one of the areas where UK is miles ahead of Japan. Just compare the two state pensions.
60,000 yearly into a private pension? How many people meet that threshold in the UK? The mean "annual pre-tax salary" is around £28,000 ".
I was thinking about the public system. I had no idea there were such massive allowances for private contributions. Very favorable to high income earners.
The UK public system is an unfunded PAYG system that is hogtied politically to the triple-lock system. It is not sustainable, nor is it a model for others to follow.
So you are not contributing to the British state pension? if you think it is not a model for others to follow....
Ah sorry for the confusion, I am not a former UK resident. I would if I could though!
However, I feel that the instability PAYG/triple lock UK pension is pretty heavily discussed. It looks even more precarious in the face of the current proposed tax cuts.
I think we are all waiting for the other shoe to drop.
60,000 yearly into a private pension? How many people meet that threshold in the UK? The mean "annual pre-tax salary" is around £28,000 ".
I was thinking about the public system. I had no idea there were such massive allowances for private contributions. Very favorable to high income earners.
The UK public system is an unfunded PAYG system that is hogtied politically to the triple-lock system. It is not sustainable, nor is it a model for others to follow.
So you are not contributing to the British state pension? if you think it is not a model for others to follow....
Ah sorry for the confusion, I am not a former UK resident. I would if I could though!
However, I feel that the instability PAYG/triple lock UK pension is pretty heavily discussed. It looks even more precarious in the face of the current proposed tax cuts.
I think we are all waiting for the other shoe to drop.
It's interesting that the current national insurance cuts will be more than cancelled out overall by the ongoing freeze in the level of personal allowances. This will have the effect of taxing pensioners proportionally more and the working population less. Perhaps a way to claw back some pensioner income without big headline changes to pensions, such as reforming/abandoning the triple lock.
So you are not contributing to the British state pension? if you think it is not a model for others to follow....
Ah sorry for the confusion, I am not a former UK resident. I would if I could though!
However, I feel that the instability PAYG/triple lock UK pension is pretty heavily discussed. It looks even more precarious in the face of the current proposed tax cuts.
I think we are all waiting for the other shoe to drop.
It's interesting that the current national insurance cuts will be more than cancelled out overall by the ongoing freeze in the level of personal allowances. This will have the effect of taxing pensioners proportionally more and the working population less. Perhaps a way to claw back some pensioner income without big headline changes to pensions, such as reforming/abandoning the triple lock.
Yes, it is rather surprising since the first five years of this Government made the basic tax-free allowance quite generous and then in the dying days of the government they decide to cut national insurance. Hunt really is the fiscal drag queen Chancellor.
60,000 yearly into a private pension? How many people meet that threshold in the UK? The mean "annual pre-tax salary" is around £28,000 ".
I was thinking about the public system. I had no idea there were such massive allowances for private contributions. Very favorable to high income earners.
The UK public system is an unfunded PAYG system that is hogtied politically to the triple-lock system. It is not sustainable, nor is it a model for others to follow.
So you are not contributing to the British state pension? if you think it is not a model for others to follow....
Ah sorry for the confusion, I am not a former UK resident. I would if I could though!
However, I feel that the instability PAYG/triple lock UK pension is pretty heavily discussed. It looks even more precarious in the face of the current proposed tax cuts.
I think we are all waiting for the other shoe to drop.
I am very impressed with your knowledge of the British economy and its fiscal dilemmas for a non-Brit.
Deep Blue wrote: ↑Tue Mar 12, 2024 12:33 pm
Unfortunately Japanese Government is bust, they can’t afford to let us keep our income, needs to be confiscated at punitive rates and impose all sorts of heinous taxes. Fortunately as an expat I can save and invest offshore to avoid the worst of these but I feel that if Japan reduced its top end rates they’d end up with a greater tax take in the end.
Invest offshore, done that, got the T-shirt and I would say most of my profit was taken away by exorbitant fees. Give me an index fund in a Ideco or NISA wrapping any day of the week.
If you are tax resident in Japan, how does investing off-shore help you avoid taxes? I invested in an off-shore plan once, but you still have to pay tax in Japan on your gains at Japanese rates, don't you? Or is there something I'm missing (probably!)?
goodandbadjapan wrote: ↑Wed Mar 13, 2024 3:33 am
If you are tax resident in Japan, how does investing off-shore help you avoid taxes? I invested in an off-shore plan once, but you still have to pay tax in Japan on your gains at Japanese rates, don't you? Or is there something I'm missing (probably!)?
I was wondering that too. Maybe you can accumulate savings tax-free, such as reinvest in a fixed term deposit as soon as it matures? But you'll have to pay tax on the gains eventually, unless you become UK-resident before you cash out *
You have to pay tax on Premium Bond winnings too, even though they are tax-free in the UK.
* Edit: Actually not sure about that. I think you'll have to pay tax on them even if you become UK-resident.
As long as you're a non-permanent resident for tax purposes, which is until you've lived in Japan for 5 of the last 10 years, and don't bring the income to Japan, you only need to pay tax on Japan-sourced income. Other than that, you become a 'resident other than non-permanent resident ' and global income is taxable.
goodandbadjapan wrote: ↑Wed Mar 13, 2024 3:33 am
If you are tax resident in Japan, how does investing off-shore help you avoid taxes? I invested in an off-shore plan once, but you still have to pay tax in Japan on your gains at Japanese rates, don't you? Or is there something I'm missing (probably!)?
Maybe move to somewhere like HK or SG before cashing in?
At least that was what I had in mind years ago when I signed up for these, but it looks like that will never happen now.
Wales4rugbyWC23 wrote: ↑Tue Mar 12, 2024 11:44 pm
Invest offshore, done that, got the T-shirt and I would say most of my profit was taken away by exorbitant fees. Give me an index fund in a Ideco or NISA wrapping any day of the week.
My offshore investments are all in low cost index funds.
Deep Blue wrote: ↑Tue Mar 12, 2024 12:33 pm
Unfortunately Japanese Government is bust, they can’t afford to let us keep our income, needs to be confiscated at punitive rates and impose all sorts of heinous taxes. Fortunately as an expat I can save and invest offshore to avoid the worst of these but I feel that if Japan reduced its top end rates they’d end up with a greater tax take in the end.
Invest offshore, done that, got the T-shirt and I would say most of my profit was taken away by exorbitant fees. Give me an index fund in a Ideco or NISA wrapping any day of the week.
If you are tax resident in Japan, how does investing off-shore help you avoid taxes? I invested in an off-shore plan once, but you still have to pay tax in Japan on your gains at Japanese rates, don't you? Or is there something I'm missing (probably!)?
I plan to leave Japan before cashing them out. Even if it’s for a short time, the financial imperative to do so is enormous.
