RetireJapan

TokyoBoglehead wrote: ↑Fri Sep 09, 2022 6:22 am https://ia803405.us.archive.org/23/item ... esting.pdf

Thank you for the link, will read this tonight

TokyoBoglehead wrote: ↑Fri Sep 09, 2022 6:22 am I strongly, strongly suggest you stop with the Youtubers.

This guys' ok

https://www.youtube.com/watch?v=MLgn_kVKjCE

tim wrote: ↑Fri Sep 09, 2022 1:38 am I have been curious by the following questions about dividend,
and been watching stuff about it, and it seems it suits my preferences but I have multiple questions about it.

What if I select my own stocks
Example: Buy 20+ stocks [health sector, energy sector, technology sector , etc]
of course I'll be researching about that company.

Is this better than just buying Dividend index funds? I want to avoid the management fee.
Like: ｱﾗｲｱﾝｽ･ﾊﾞｰﾝｽﾀｲﾝ･米国成長株投信Dｺｰｽ毎月決算型(為替ﾍｯｼﾞなし)予想分配金提1示型 or OUSA

This guy does a great job of explaining dividends, and when they are most appropriate for shareholders.

https://www.youtube.com/watch?v=ckJ5K2n0K5w

I am using Rakuten securities
and I bough some 米国株式
Is it possible to set the dividends to be Reinvested?
I see the option when buying mutual funds but not for individual stocks

tim wrote: ↑Tue Sep 13, 2022 6:29 am I am using Rakuten securities
and I bough some 米国株式
Is it possible to set the dividends to be Reinvested?
I see the option when buying mutual funds but not for individual stocks

In a Designated Account or a regular account?

In any case, you will have to do a Kakutei Shinkoku to square up at the end of the year.

Dividend Taxes in Japan are 20.315% (15% National, 0.315% Recontruction, and 5% Residents' Taxes), and if your total income is greater than about Y3.3M then it is better to choose these Separate Taxation Method Dividend Taxes rather than taxing Dividends under you Aggregate Income at your Marginal Rate of Tax (Marginal Rates of National andf Reconstruction Taxes, and 10% Residents' Taxes).

If you are NOT an American Citizen, you WILL be subjected to US Withholding Tax on the US Dividend Income.

You need to file a W8-BEN Form with your broker to claim the benefit of the US-Japan Tax Treaty. Rakuten will have probably filed the Paperwork for you...

If you/they do not file a W8-BEN correctly, then you will be subject to US Withholding Tax on the Dividends at 30%.
If you/they correctly file the W8-BEN, under the US-Japan Tax Treaty you will only be subject to US Withholding Tax at 10%. This tax is payable to Uncle Sam for US derived income.

Any Foreign National (non-US Citizen), including Japanese, who is filing a W8-BEN should in Part I state:

Part I Identification of Beneficial Owner
6 Foreign tax identifying number (see instructions)

You should put your 'My Number' here

And in Part II state:

Part II Claim of Tax Treaty Benefits (for chapter 3 purposes only) (see instructions)
9. I certify that the beneficial owner is a resident of ___JAPAN___ within the meaning of the income tax treaty between the United States and that country.
10. Special rates and conditions (if applicable—see instructions): The beneficial owner is claiming the provisions of Article and paragraph
_10 2(b),11 2(b)_ of the treaty identified on line 9 above to claim a ___10___ % rate of withholding on (specify type of income):
___Dividend and Interest Income___
Explain the additional conditions in the Article and paragraph the beneficial owner meets to be eligible for the rate of withholding:
___As A Resident Of Japan for Tax Purposes.___

The Broker will then withhold US Tax due to Uncle Sam at 10%

In Japan, you need to file a Kakutei Shinkoku by Mar 15, and you need to select the Separate Self-Assessment Taxation method (Form B - Pages 1&2 And Page 3).
Under the Separate Self-Assessment Taxation method, you will be liable to 20.315% Dividend Tax (15% National, 0.315% Reconstruction, and 5% Residential Taxes).

You should then receive a 1042-S Statement (or your Broker's equivalent report form) of US Taxes Withheld from your broker, around the beginning of April, in time for US Tax Filing (Apr 15).

You can then report this in your Kakutei Shinkoku (amend later if necessary) and claim the Foreign Tax Credit for the 10% Tax paid in the US - Form B Page 1 - Item 46.
So then your taxes become 10% US Withholding, 5% National, 0.315% Reconstruction, and 5% Residential Taxes.


If you ARE a US Citizen, then, you need to file a Kakutei Shinkoku by Mar 15, and you need to select the Separate Self-Assessment Taxation method (Form B - Pages 1&2 And Page 3).
Under the Separate Self-Assessment Taxation method, you will be liable to 20.315% Dividend Tax (15% National, 0.315% Reconstruction, and 5% Residential Taxes).

After filing your US Taxes, IF you had to pay any tax on the Dividend Income, you can then report this in your Kakutei Shinkoku (amend later if necessary) and claim the Foreign Tax Credit for the Tax paid in the US - Form B Page 1 - Item 46.
So then your taxes become US Tax Rate, 15% minus US Tax Rate National, 0.315% Reconstruction, and 5% Residential Taxes.

Tkydon wrote: ↑Tue Sep 13, 2022 6:22 am https://www.youtube.com/watch?v=ckJ5K2n0K5w

will watch this tonight

Tkydon wrote: ↑Tue Sep 13, 2022 6:53 am In a Designated Account or a regular account?

A regular account, Non-US citizen and income is beyond Y3.3 annually
I hate paper works but I hate losing money more.
I will read more about this
Thanks for the elaborate explanation
I really appreciate it

Sometimes its hard to know from the materials I read, whether its applicable to the US only or globally

tim wrote: ↑Tue Sep 13, 2022 7:15 am

Tkydon wrote: ↑Tue Sep 13, 2022 6:22 am https://www.youtube.com/watch?v=ckJ5K2n0K5w

will watch this tonight

Tkydon wrote: ↑Tue Sep 13, 2022 6:53 am In a Designated Account or a regular account?

A regular account, Non-US citizen and income is beyond Y3.3 annually
I hate paper works but I hate losing money more.
I will read more about this
Thanks for the elaborate explanation
I really appreciate it

The average Japanese investor would not be able to file the W8-BEN on their own, so the Japanese Broker does it on their behalf, and then translates the Notice of Tax Withholding 1042-S (The US equivalent of the Gensen Chosuhyo) into Japanese for them, so that they can then file their Japanese taxes - Kakutei Shinkoku.

"Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting"
https://www.irs.gov/pub/irs-pdf/fw8ben.pdf
https://www.irs.gov/forms-pubs/about-form-w-8-ben

Good Explanation Here:
https://www.investopedia.com/terms/w/w8form.asp

tim wrote: ↑Tue Sep 13, 2022 6:29 am I am using Rakuten securities
and I bough some 米国株式
Is it possible to set the dividends to be Reinvested?
I see the option when buying mutual funds but not for individual stocks

Monex introduced DRIP for US funds last year.

TokyoBoglehead wrote: ↑Tue Sep 13, 2022 8:36 am Monex introduced DRIP for US funds last year.

Thank you for the information, but I'll stick with rakuten for now until I'm settled in.

I have a question regarding selling stocks / mutual funds / ETF

What happens if I sell a stock and gain 100 yen out of it? Is it still taxed?
Does long-term and short-term capital gains tax rate exist in Japan? like holding a stock for a year to have a lower tax rate?

Thank in advance