•There will be a new Nisa beside the current tsumitate Nisa.
•The new Nisa is in place from 2023 to 2028 (so after the current one is ending)
•You can Invest up to 122万円 a year and its tax free for 5 years like the current.
•Out of this 122万円JPY, 20万円 can only be invested into non-risky investments = funds, and will be similar to the current tsumitate Nisa.
•The rest can be invested into stocks as now, but the government is looking into excluding certain risky investment products.
•The current tsumitate Nisa gets prolonged for 5 years until 2042. Taxfree for 20 years like now stays the same.
•The Junior Nisa doesn’t get renewed after 2023, despite that there are 300,000 accounts.
One reason because that is listed despite previous plans to stop it, is that they fear there are less investments into startups. Interesting.
I wonder why the tsumitate nisa still has an end date , it would make more sense to make this permanent and avoid those repeating discussions. I think in the future we will even see more encouragement into private retire investment.
Do you know if we are we losing the right to roll-over existing NISA's? Can we roll the old NISA over into the new NISA? I was really hoping they would make regular NISA permanent
I have the same question than eyeswideshut...
Will the systems be completely different?
I started my NISA in 2018 so I can put 1,2M up to 2022 included in it.
At the end of those 5 years, would it be possible to rollover the full portfolio to keep having dividends tax-free on those 5 years investment?
Or will it go on a tokutei account and we have to start "from 0" again and pay taxes on dividends for all old investments?
Edit: I mean that if the old NISA completely disappears at the end of 2023, it's either rollover the full 5 years period or nothing no? not one year by year anymore when we reach 5 years for each year?
In the article there is nothing stated above that - time will tell. But as the limit for non-mutual funds is lower than now, I would guess that you cant roll over from the old system to the new system.
mule96 wrote: ↑Mon Dec 09, 2019 7:10 am
In the article there is nothing stated above that - time will tell. But as the limit for non-mutual funds is lower than now, I would guess that you cant roll over from the old system to the new system.
That is my assumption too. I imagine (with no evidence whatsoever) that they may let you transfer existing funds to the new NISA up to the new cash limit and subject to the fund eligibility rules but the excess will end up in taxable. Effectively it will be the same as cashing out and reinvesting under the new rules. So you get a 5 year tax holiday, not a permanent tax holiday. Now I am wondering if Tsumitate is actually a better deal as you get a 20 year tax holiday (but funded at a lesser amount)
The article mentioned nothing about rollovers but the new NISA is a 2 tier program. The first tier is a safe ETFs only, up to 20k, the next is the current NISA up till 102k. You must use up the first tier before you can do the second. They still haven't decided what is a 'safe' ETF, but it should probably be what's in the current tsumitate NISA plan. So presumably, you'll have to buy maybe 20k worth of eMaxis before you can roll over?
Again, this isn't anything final but merely a proposal that will be debated in parliament. The problem with the current plan is that a large portion of users are trading instead of investing and their plan is to nudge people towards long term investments instead.
In the current NISA if I understood well there was no problem to rollover more than the current year limit.
For example if the 1,2M investment of 5 years before became 1,8M we could rollover the full 1,8M but wouldn't be able to invest on that year.
If the 1,2M made a loss and were actually 700k, we could rollover the 700k and invest 500k more.
I guess the fact that we have to invest 20k first is quite problematic to rollover.... Or maybe there will be some exceptions for rollover? At least I hope so, it would be quite a pity otherwise...
If we can't I guess I'll just let everything go in a tokutei account but I hope nothing will be at loss at that time to not pay too much tax on future growth...
In the current NISA if I understood well there was no problem to rollover more than the current year limit.
For example if the 1,2M investment of 5 years before became 1,8M we could rollover the full 1,8M but wouldn't be able to invest on that year.
If the 1,2M made a loss and were actually 700k, we could rollover the 700k and invest 500k more.
I guess the fact that we have to invest 20k first is quite problematic to rollover.... Or maybe there will be some exceptions for rollover? At least I hope so, it would be quite a pity otherwise...
I agree. This is what is very confusing about what's been published about the new system. The ability to rollover ever-increasing amounts every 5 years in one NISA cohort is the main advantage that makes the Japanese NISA in any way close to the UK ISA system it was supposed to mimic mutch less the US 401K or IRA retirement accounts.
Jansen wrote: ↑Tue Dec 10, 2019 12:47 pm
The problem with the current plan is that a large portion of users are trading instead of investing
Interesting. That looks to me like a problem with people's financial education (or lack of it), not a problem with the tool. You can technically today do long term investments with NISA if you want to (and I think that's what most of us on this forum do). So I think changing the tool is not going to solve the problem that people don't understand how the "buy and hold" game is played in the long run.
