Subsequent NISA accounts (?)

[TimRetJap]

I think this is my first time posting so greetings & salutations to all, & thanks to Ben for making Retire Japan.

I got my first NISA already to go, but now I have a question about my future NISA accounts.

I opened up a standard NISA this fall, let’s call it NISA 2020. As I understand it, I have 5 years (more like 4 now cuz of my late start) to invest a maximum of ¥1.2million.
Next year I can open a new NISA account, let’s call that NISA 2021...leaning towards a tsumitate NISA for 2021, so then I’d have two NISA accounts running...until 2022 when I would open a third NISA account, say NISA 2022. Blah blah blah, and in 2024 I’d open my fifth NISA account in January, and rollover or close my NISA 2020 by the end of December. Do I have this right? I did see somewhere someone had written that you could invest ¥1.2mil in your standard NISA every year for five years totaling ¥6mil in that one, say NISA 2020, account. I’m not sure which explanation is correct. Could someone please set me straight?

Also, as I understand it, you can choose either NISA or tsumitate NISA each time you open a new account, but that all your current accounts must be with the same provider (Rakuten, SBI, etc.)...

Thanks for reading my posting.
Tim

[RetireJapan]

Hi Tim

That's not quite right

You have until the end of December to invest up to 1.2m yen in your 2020 ordinary NISA account (there is no minimum). In practice you should aim to have everything done by the beginning of December, as it can take time for purchases to go through and if they take too long they will go into your 2021 account instead.

Your 2020 NISA account will be tax free until December 2024, at which point your investments will either move to your taxable account or (if allowed in 2024) be rolled over into a new NISA account.

Your 2021 NISA account will work in the same way, and run until 2025.

To make things more fun, the current NISA accounts will only be available until 2023, after which the new ordinary NISA will start: https://www.retirejapan.com/blog/nisa-changes/

[TimRetJap]

Thanks for the clarification. If I were to want to do so, could I designate the 2021 NISA account to be a tsumitate NISA?

Is there the same sort of application procedure for subsequent NISAs, or does it just keep allowing me to start the next round each year with no hassles?

[RetireJapan]

Your provider will give you the option of opening the same type of NISA the following year, or switching NISA type. You can also open a NISA account with a different provider (you can only have one NISA account per calendar year).

The provider will contact you to ask, or there will be a link or setting somewhere.

[TimRetJap]

Much appreciated!