RetireJapan

I have a regular Nisa account from 2017 which will be ending the NISA wrapper at the end of the year. I am not planning to roll it over as I already plan to use my NISA location for a TsumitateNISA account. I was wondering what happens to the Mutual funds if I do nothing? Will they just lose their tax exempt wrapper and I will be taxed on the profit or some other outcome. Also, what are your options at the end of five years?

workbalance wrote: ↑Tue Dec 28, 2021 11:07 am I have a regular Nisa account from 2017 which will be ending the NISA wrapper at the end of the year. I am not planning to roll it over as I already plan to use my NISA location for a TsumitateNISA account. I was wondering what happens to the Mutual funds if I do nothing? Will they just lose their tax exempt wrapper and I will be taxed on the profit or some other outcome. Also, what are your options at the end of five years?

It will pop into your regular taxable account.

The price on the last day in your Nisa will be treated as the "sale price". Any capital gains beyond this will be taxed at 20.15% upon sale.

I'm not sure if you're too late to change your mind, but if the value is considerably more than 1.2M yen, you might want to consider rolling over to lock in the tax protection for another 5 years.

Tsumitate is a good choice for *new* investments, but if you already have a NISA that has performed well, you will be getting a much greater tax-free allowance next year by rolling over than you will get from starting an empty Tsumitate next year.

EmaxisSlim Cultist wrote: ↑Tue Dec 28, 2021 11:42 am

workbalance wrote: ↑Tue Dec 28, 2021 11:07 am I have a regular Nisa account from 2017 which will be ending the NISA wrapper at the end of the year. I am not planning to roll it over as I already plan to use my NISA location for a TsumitateNISA account. I was wondering what happens to the Mutual funds if I do nothing? Will they just lose their tax exempt wrapper and I will be taxed on the profit or some other outcome. Also, what are your options at the end of five years?

It will pop into your regular taxable account.

The price on the last day in your Nisa will be treated as the "sale price". Any capital gains beyond this will be taxed at 20.15% upon sale.

"Buy price", right?

"Buy price", right?

Yes, or rather cost basis. Your cost basis includes both the price of the shares and any transaction costs and that is re-set as of the day shares emerge from a NISA account (including cases where the cost basis set lower than your actual cost because the shares fell in price).