RetireJapan

So I regularly go over my NISA limit that it is inadvertent that some of my investments will have to be made outside of NISA. I don't want to wait til NISA is full to invest outside of NISA so I was wondering if there are typical types of funds that are better outside of NISA than others (not in comparson to NISA but in comparison with other stocks, funds). For example I am of the thinking that if I had to choose, REIT would be better outside of NISA since they will likely have little movement in the 5 years compared to other funds.

By the way, how are dividends from NISA stocks taxed?

I also hit the limit for both NISA and IDECO every month and invest the rest of my money in a standard account.
The simplest rule is that you want to buy the highest return assets in your IDECO and NISA and lowest return assets in your investment account. This is because IDECO and NISA are tax free on capital gains, therefore you want to put the assets with the highest probability in capital gains in these accounts in priority.

You start by buying the highest potential return asset in your IDECO until it is full, then in your NISA if needed until it is full, then in your investment account.
Repeat for the second asset with the highest return.
etc. until your lowest return asset (usually bonds)

In my case, I have a very simple portfolio of "emaxis all world" and "emaxis developped countries bonds".
I fill in my IDECO then NISA with "emaxis all world", then put more of it in my investment account until I reach my investment target, then buy "emaxis developped countries bonds" in my investment account.

Dividends are not taxed within a NISA account, except for US-listed ones: they have the 10% withholding tax taken out.

RetireJapan wrote: ↑Wed Dec 04, 2019 7:20 am Dividends are not taxed within a NISA account, except for US-listed ones: they have the 10% withholding tax taken out.

Even when you receive the dividends? Despite my setting to reinvest the dividends, some still come to me in cash.

crew wrote: ↑Wed Dec 04, 2019 8:13 am

RetireJapan wrote: ↑Wed Dec 04, 2019 7:20 am Dividends are not taxed within a NISA account, except for US-listed ones: they have the 10% withholding tax taken out.

Even when you receive the dividends? Despite my setting to reinvest the dividends, some still come to me in cash.

Yes, this is kind of the point of NISA

And if you don't receive a dividend, there is no taxable event surely, even in a taxable account.

And if you don't receive a dividend, there is no taxable event surely, even in a taxable account.

That's what I am saying. I did receive it. Its in my savings account now looking lost.

crew wrote: ↑Thu Dec 05, 2019 6:15 am

And if you don't receive a dividend, there is no taxable event surely, even in a taxable account.

That's what I am saying. I did receive it. Its in my savings account now looking lost.

Not sure what you mean.

NISA accounts shelter the contents from tax: you don't have to pay tax on capital gains or dividends.
Dividends from investments in NISA accounts are paid out according to your account settings, usually into your cash account with the broker or to a bank account (may not be tax free in the latter case).

RetireJapan wrote: ↑Thu Dec 05, 2019 7:20 am

crew wrote: ↑Thu Dec 05, 2019 6:15 am

And if you don't receive a dividend, there is no taxable event surely, even in a taxable account.

That's what I am saying. I did receive it. Its in my savings account now looking lost.

Not sure what you mean.

NISA accounts shelter the contents from tax: you don't have to pay tax on capital gains or dividends.
Dividends from investments in NISA accounts are paid out according to your account settings, usually into your cash account with the broker or to a bank account (may not be tax free in the latter case).

I think he means that the dividend was paid into his broker account and hence he has funds showing there, whereas he thought they would be reinvested automatically and just added to the shares he holds in the NISA wrapper. So I guess crew's question is, if the dividend is paid and hence not in the NISA wrapper anymore is tax due on it, has tax been deducted already or is that dividend tax-free because it was generated from NISA held funds. I assume it's the latter.

RetireJapan wrote: ↑Thu Dec 05, 2019 7:20 am I think he means that the dividend was paid into his broker account and hence he has funds showing there, whereas he thought they would be reinvested automatically and just added to the shares he holds in the NISA wrapper. So I guess crew's question is, if the dividend is paid and hence not in the NISA wrapper anymore is tax due on it, has tax been deducted already or is that dividend tax-free because it was generated from NISA held funds. I assume it's the latter.

Yes, if the dividend is paid into the broker account from a NISA investment, it is paid without deducting Japanese tax on dividends (and none is due/there is no reporting requirement).

As for the reinvesting, there is a chance the settings were not chosen correctly on the initial investment. Might be worth checking

Goodandbadjapan got my question correct entirely, thoughI got the dividends in my BANK account. For some reason despite my settings, dividends from certain funds are still paid out. So I was wondering if these were taxed since its in my bank account already.