Taxation of 'accumulation' ETF in Japan

[jogu]

Can anyone help me understand how accumulation exchange traded funds are taxed in Japan please? I've tried a few google searches but haven't managed to find anything.

These are funds that don't pay any dividends, instead any dividends are added to the value of the fund - e.g. https://monevator.com/income-tax-on-accumulation-unit/

In the UK HMRC has decided this process gives rise to a 'notional distribution' that you pay income tax on. Does anyone know if Japan has a similar special rule?

[eyeswideshut]

I looked into this a while back and the answer seems to be no - Japan does not tax 'deemed' dividends from such ETFs. I hold multiple Irish-domiciled 'dividend accumulating' ETFs listed on the LSE and use an accountant to do my taxes and my accountant also agrees these ETFs are only subject to capital gains tax upon sale as they pay out no dividends.

[jogu]

That's great - thanks for your insight eyeswideshut!

[Chizakura]

Yes, that's correct. This is why accumulating ETFs are generally the best choice, unless you plan to rely on the dividends for living/consumption, e.g. after you have retired.