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Did you know that foreigners can also invest using Shin NISA?
Renewed in 2024, the NISA (Nippon (Japan) Individual Savings Account) extended the tax exemption limit up to JPY 18 million and the tax exemption period was also made unlimited. Foreigners living in Japan can also benefit from this system by opening an account. However, questions such as “Which brokerage house can I open an account with?”, “What are the required documents?”, “What kind of investment strategy should I follow?” may be on your mind.
In this article, we explain in detail the advantages of Shin NISA for foreigners, account opening steps, recommended brokers and effective investment strategies. Start growing your investments in Japan by using Shin NISA wisely!
- Basic information about Shin NISA
- Advantages of Shin NISA
- Steps to open a Shin NISA investment account
- How to grow your assets using Shin NISA
- Key features of Shin NISA
- 5 big advantages of Shin NISA that foreigners should know
- Benefit from JPY 18 million tax exemption
- Indefinite tax exemption: Long-term investment opportunity with no tax time limit
- Various investment options
- Tax advantage: Investment gains are tax exempt, allowing for more efficient asset management
- Flexible investment style: Invest at your own pace with lump sum or regular investment
- Foreigners can open investment accounts in Japan too! Shin NISA application process
- Smart asset management strategies with Shin NISA
- Summary | Start smart investing with Shin NISA!
Key features of Shin NISA
First, let’s take a look at the main features of Shin NISA that foreigners living in Japan should know.
What is Shin NISA?
Shin NISA is Japan’s new small-scale tax-exempt investment system starting in 2024. Its most important feature is the investment limit, which provides tax exemption up to a total of 18 million yen. This limit is divided into a regular investment limit (JPY 6 million) and a growth-oriented investment limit (JPY 12 million) and is suitable for long-term asset building. In addition, the tax exemption period is unlimited, which allows for more flexible investment.
By opening a NISA account, you can invest in various financial products such as stocks, mutual funds and ETFs. You can increase your savings more efficiently by taking advantage of tax benefits.
| Regular investment limit | Growth-oriented investment limit | |
|---|---|---|
| Duration of tax exemption | Unlimited | Unlimited |
| Annual investment limit | 1.2 million JPY | 2.4 million JPY |
| Upper limit of tax exemption | JPY 18 million (limit reusable) | |
| 6 million JPY | 12 million JPY | |
| Account opening period | Indefinite | Indefinite |
| Investment products | Investment funds suitable for long-term regular investment and diversification (limited to investment funds that meet the criteria of the Financial Services Agency (FSA)) | Publicly traded stocks, mutual funds, etc. |
| Age limit | 18 years and over | 18 years and over |
Source: Based on data from the Financial Services Agency「NISAを知る」.
Living in Japan Can foreigners also benefit from Shin NISA? Is it possible to open an investment account?
Yes, foreigners can also open a Shin NISA account if they meet certain requirements.
Foreigners aged 18 and over, residing in Japan, can easily open an account as long as they have a residence card (Zairyu Card) and My Number Card. Those planning to leave Japan in the future should not worry either, as they can fully cash out their investments before returning.
With the right information and following the necessary procedures, foreigners living in Japan can also use Shin NISA to invest their savings with peace of mind.
5 big advantages of Shin NISA that foreigners should know
In this episode, we share with you the 5 major advantages of Shin NISA.
Read on so you don’t miss out on these opportunities, which are also very useful for foreigners living in Japan!
Benefit from JPY 18 million tax exemption
With Shin NISA you can benefit from an investment limit with a maximum tax exemption of JPY 18 million. This limit is divided into two different investment types:
- Regular investment limit: JPY 6 million (for long-term, stable investments)
- Growth-oriented investment limit: JPY 12 million (for investments with higher return potential)
This allows you to create a balanced portfolio according to your investment objectives and risk tolerance. It also makes it easier for you to develop flexible investment strategies as you can reuse the limit of the investments you sell.
Indefinite tax exemption: Long-term investment opportunity with no tax time limit
One of the great features of Shin NISA is that the tax exemption period is unlimited. This means that you can make long-term investments without worrying about the tax-free period. Since Shin NISA has no time limit, any gains you make will always remain tax exempt for as long as you hold your investments.
The main advantage of this system is that it facilitates long-term savings and wealth creation. Assets such as stocks and mutual funds, in particular, have the potential to grow more steadily over the long term with a compounded return effect. In addition, you do not have to sell your investments in a hurry for tax reasons, so you can make more flexible and strategic decisions based on market conditions.
Various investment options
Shin NISA offers the possibility to invest in stocks, mutual funds and many other financial products. This way, you can create the ideal portfolio to suit your investment objectives and risk tolerance.
For example, equities are suitable for investors seeking high returns in the short term, as they offer the opportunity to invest in companies with high growth potential. On the other hand, since mutual funds are managed by professional portfolio managers, they offer a diversified investment strategy with lower risk for beginner investors.
The wide range of investment options offered by Shin NISA makes it possible to both build a stable accumulation process and manage risks effectively.
Tax advantage: Investment gains are tax exempt, allowing for more efficient asset management
One of the biggest advantages of Shin NISA is that investment gains are tax-free. In Japan, there is normally a 20.315% tax deduction on stock and mutual fund gains. However, gains on investments made in a Shin NISA account are completely tax-free, allowing you to grow your assets more quickly and efficiently.
For example, an investor who normally makes a profit of JPY 100,000 has to pay about JPY 20,000 in taxes. With Shin NISA, however, this profit remains entirely in the investor’s pocket. The tax advantage maximizes the compound return effect and accelerates long-term asset building.
Especially for foreigners living in Japan, this tax advantage is a great opportunity. By using Shin NISA wisely, you can create the most efficient investment strategy during your stay in Japan.
Flexible investment style: Invest at your own pace with lump sum or regular investment
One of the biggest advantages of Shin NISA is that it offers flexible investment to suit your personal financial situation and lifestyle. Shin NISA offers both lump sum and regular investment, so you can freely choose your investment style.
For example, lump sum investing is suitable for those who want to invest a large amount of savings at once and earn high returns on market movements. Regular investment is ideal for those who want to spread risks and reduce the impact of market fluctuations by investing a certain amount each month.
You also have the freedom to change your strategy at any time during the investment process. This flexibility allows both beginners and experienced traders to create an asset management strategy that suits their own pace. With Shin NISA, you can manage your investments easily, flexibly and efficiently.
Foreigners can open investment accounts in Japan too! Shin NISA application process
Shin NISA also offers easy account opening for foreigners living in Japan. The application process requires documents such as a residence card (Zairyu Card), My Number Card and passport.
To open an account, you first need to choose a brokerage firm (broker). You can then complete your application by submitting the required documents online or by mail to the relevant company. Once the documents have been reviewed and your application has been approved, your Shin NISA account will be opened.
Especially Rakuten Shoken and moomoo証券Online brokerage firms such as Japan Investment Brokerage, offer a fast and convenient trading process, as you can easily open an account using only your smartphone. For foreigners living in Japan, these platforms are highly advantageous for making an easy and hassle-free investment start.
Required documents and requirements
In order to open a Shin NISA account, you must be a foreigner with a residence registration (jūminhyō) in Japan. In addition, you need to prepare the following documents during the application process:
- Residence Card (Zairyu Card): A mandatory document proving that you are a legal resident of Japan.
- My Number Card: Required for tax purposes.
- Identity verification documents: Usually a Residence Card (Zairyuu Card) and My Number Card are sufficient. However, some brokers may request additional documents such as a passport or a driver’s license obtained in Japan.
- Residence record (where required): Some brokers may require you to submit your residence record (Jūminhyō) in addition.
In addition, you must be at least 18 years old to apply. Depending on the policy of the intermediary agency you choose, additional documents related to your visa type and length of residence may be required. It will be useful to check the requirements of the intermediary organization before applying to ensure that the process goes smoothly.
Recommended brokerage houses for foreigners
For foreigners considering opening a Shin NISA account, it is important to choose a brokerage firm that offers low trading fees and strong customer support. In this regard, Rakuten Shoken and moomoo証券 are among the prominent options.
Rakuten Shoken
- Easy account opening: Apply online using only a smartphone. Account opening can be completed the next business day at the earliest.
- Industry leader in NISA accounts: 12 million general investment accounts by January 2025.
- Wide Range of Products: Provides access to a variety of investment instruments such as stocks, mutual funds, ETFs, foreign stocks and gold.
- Earning and redeeming Rakuten points: You can earn Rakuten points by using “Rakuten Card credit payment” for mutual fund purchases and transactions. Earned points can be used for everyday purchases or Rakuten Shoken through which it can be reinvested.
- Low transaction fees: There are no transaction fees for domestic stock trading.
- Money Bridge feature: Integrates with Rakuten Bank to provide automatic money transfers.
- User-friendly application: By offering an easy mobile app, you can easily invest from anywhere, 24 hours a day.
- Those who use other Rakuten services such as Rakuten Ichiba, Rakuten Card and Rakuten Bank.
- Rakuten Shoken who want to accumulate more Rakuten points when trading with Rakuten.
- Investors planning to invest in domestic equities and mutual funds.
Moomoo Shoken
- Easy account opening: You can open an account and trade using just your smartphone. The account opening process can be completed within a few days and you can start trading.
- More than 24 million users worldwide: A global financial institution listed on the NASDAQ exchange and offers high reliability.
- Free trading fees at Shin NISA: There are no commission fees for trading Japanese stocks and US stocks through a Shin NISA account, minimizing trading costs.
- Low-cost trading options: With the exception of Shin NISA, there are no commission fees for Japanese shares. The trading fee for US shares is 0.132% of the transaction amount, one of the lowest in the industry.
- Advanced English support: The app and customer support services are also available in English, which is very convenient for foreign traders.
- Global investment opportunities: Not limited to Japanese stocks, access to US stocks and other international markets. In addition, market news from around the world can be followed quickly and completely.
- Free access to a wide range of investment information: Free access to a wide range of financial data such as exchange rates, futures and cryptocurrency markets.
- Expert analysis videos: You can increase your investment knowledge by watching expert analysis on market trends and investment strategies of different countries.
- Comprehensive support service: There is a comprehensive FAQ section on topics such as the account opening process, tax treatment and trading terminology. It offers quick responses to its users via phone, email and 24/7 live chat support.
- Various campaigns: Depending on account opening or trading volume, you can benefit from cashback and various promotions.
- Those who want to invest internationally by gaining access to global markets.
- Investors wishing to trade in US and other foreign markets other than Japanese equities.
- Those looking for a trading platform with English language support.
Steps to open a Shin NISA investment account
The process of opening a Shin NISA account consists of the following steps. In most cases, the entire process can be completed using only a smartphone, making the account opening process very quick and hassle-free.
- STEP 1Select a brokerage firm
Choose a brokerage that suits your needs, such as Rakuten Shoken and moomoo証券.
- STEP 2Apply online
Complete the account opening application by logging in to the official website or mobile application of your chosen brokerage firm. Remember to answer “Yes” to the question “Do you want to open a NISA account?” during the application, as the Shin NISA account is part of your trading account.
- STEP 3Submit the required documents
Upload documents such as a residence card (Zairyu Card), My Number Card and passport for identity verification.
- STEP 4Authentication process
Complete the online authentication process. In some cases, additional verification by facial recognition or video interview may be required.
- STEP 5Approval of the application and opening of the account
Your application is evaluated by the brokerage firm and once approved, your account opening is completed. The approval process is usually completed within a few days and you can start trading.
Things to consider when opening a Shin NISA investment account in Japan
Before opening a Shin NISA account, you should consider the following important points to ensure a smooth process.
- Each person can open only one NISA account: Only one Shin NISA account can be opened for each individual. It is not possible to open accounts with more than one broker at the same time, so be careful when deciding which broker to use.
- The address information must match: The address on the identity documents you upload with your application must match your residential address (住民票 – jūminhyō) in Japan. If the addresses do not match, the approval of your application may be delayed.
- My Number (マイナナンバー) Card is mandatory: You must present your My Number Card in order to open a Shin NISA account. You must have this document ready before applying.
- You may need to close the account if you leave Japan: If you plan to leave Japan, you may need to close your Shin NISA account. It is important to check with your broker about the status of your account before moving abroad.
- There is an approval process for account opening: When opening a Shin NISA account, you will go through an approval process by the brokerage firm. Incomplete or inaccurate documentation can prolong the process, so make sure to complete your application with complete and accurate information.
Smart asset management strategies with Shin NISA
Shin NISA allows you to make the most of the tax exemption advantage, enabling you to make effective asset management. With the right strategies, you can increase your savings in the long term and achieve your financial goals.
A regular investment limit (つみたて投資枠) is the best option for beginners. By focusing on long-term and low-risk investments, you can grow your capital steadily. Regular investment provides an average cost advantage without being affected by market fluctuations and facilitates risk management.
Those who are more experienced in investing can use the growth-oriented investment limit (成長投資枠) to invest in stocks or mutual funds with high growth potential to generate higher returns. However, it is important to keep in mind that the risks are also higher in this type of investment.
The key to a successful investment strategy is to invest in different asset classes to minimize risks. By including a balanced mix of different investment instruments such as stocks, mutual funds and commodities in your portfolio, you can create an investment strategy that is more resilient to market fluctuations .
By using Shin NISA in accordance with your own investment goals and life plan, you can increase your productivity and build a strong financial foundation for the long term.
Investment strategies for beginner traders
For those who start investing using Shin NISA, it is important to achieve a stable return by minimizing risks. Therefore, one of the most suitable options for beginner traders is to invest regularly every month using the “Regular Investment Limit”.
Regular investing allows you to hedge against market price fluctuations by investing a certain amount each month. This method is called “dollar-cost averaging” and helps you reduce risks by stabilizing the cost of investment.
One of the most preferred investment instruments for regular investing is index funds. Index funds are mutual funds managed in relation to a specific stock market index (for example, the S&P 500 or global stock market indices).
These funds are particularly suitable for start-ups as they are low-cost, broad-based investments that provide stable growth over the long term .
- eMAXIS Slim米国株式（Ｓ＆Ｐ５００）→ eMAXIS Slim US Equity Fund (S&P 500) (Aims for long-term growth by investing in the top 500 companies in the US).
- eMAXIS Slim 全世界株式（オール・カントリー）→ eMAXIS Slim All Country Equity Fund (Invests in equities around the world and offers a broad portfolio diversification)
Diversified investment strategies that minimize risks
One of the most effective ways to minimize risks when investing is to create a diversified portfolio. Diversification can be done in terms of asset types, geographical regions and investment timing.
Asset diversification (allocation to different investment instruments)
By investing in different investment instruments, you can spread risk without being tied to a single asset. For example:
✅ Equities: Offer long-term growth potential.
✅ Mutual funds: Professionally managed funds offer balanced investment opportunities.
✅ Gold and precious metals: Serves as a safe haven in times of economic uncertainty.
This diversification ensures that if one asset class depreciates, the others play an offsetting role.
Geographic diversification (investing in different countries and markets)
Instead of limiting your investments to Japan or a single country, you can reduce risks by spreading your investments across different regions.
✅ Japan stocks: Suitable for those who want to invest in the local market.
✅ US shares: Offer growth opportunities in the world’s largest economy.
✅ Emerging markets: Provides access to markets with high growth potential.
📌 Recommendation: “All World Equity Index Funds” can be used to invest across the world’s markets. These funds help you expand your investments on a global scale.
Time diversification (reducing price fluctuations through regular investment)
It is a safer strategy to invest regularly over a period of time rather than making a large investment all at once to avoid being affected by market fluctuations.
This strategy helps you build a more stable portfolio in the long run .
Tax measures that foreign investors living in Japan should be aware of
For foreigners investing in Japan, it is important to understand the tax regulations. Since profits (dividends and sales gains) generated using Shin NISA are exempt from tax, it is possible to grow assets efficiently. However, it is important to note that investments outside your NISA account will be taxed at approximately 20,315%.
In addition, dividends or gains on sale from investments made outside Japan (e.g. in the US) may be subject to withholding tax in the country of investment. In this case, there may be a risk of double taxation by both the country of investment and Japan. However, the tax burden can be reduced by taking advantage of tax benefits such as a deduction for foreign taxes (外国税額控除).
In addition, how investment assets are managed when leaving Japan can also affect the amount of tax. Therefore, consulting with an expert in advance will help you manage your investments in the most efficient way.
Summary | Start smart investing with Shin NISA!
Shin NISA is also an attractive investment vehicle for foreigners living in Japan. With an 18 million yen tax exemption, indefinite tax benefits and a wide range of investment options, there are many opportunities for both beginners and experienced investors. Rakuten Shoken and moomoo証券 With online brokerage firms such as the online brokerage platform, you can easily open an account and start investing using just your phone.
By making the most of tax advantages, you can grow your long-term savings with an investment strategy that suits you. It is possible to achieve stable returns with the right knowledge and strategy! Start your smart investment journey by using Shin NISA now !
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