Japan’s NISA (少額投資非課税制度) is one of the most powerful tax-free investment tools available to residents. And yes — foreigners can use it.
What Is NISA?
NISA lets you invest in stocks and mutual funds without paying capital gains tax or dividend tax on profits within the account.
Normal investing in Japan: 20.315% tax on gains and dividends
NISA investing: 0% tax on gains and dividends
From 2024, Japan introduced the New NISA with significantly expanded limits:
| Feature | New NISA (2024+) |
|---|---|
| Annual investment limit | ¥3.6M/year (¥1.2M Tsumitate + ¥2.4M Growth) |
| Lifetime limit | ¥18M |
| Tax-free period | Indefinite (no time limit) |
| Types | Tsumitate (積立) + Growth (成長) |
Can Foreigners Use NISA?
Yes, if you are:
- A resident of Japan (hold a valid Residence Card)
- Age 18 or older
- Not a US citizen or permanent resident (US persons face FATCA complications — most brokers reject them for NISA)
If you’re American: Unfortunately, the US-Japan tax treaty and FATCA rules make NISA impractical for US citizens in Japan. Consult a cross-border tax advisor.
How to Open a NISA Account
Step 1 — Choose a Broker
| Broker | Recommended For | English Support |
|---|---|---|
| SBI Securities (SBI証券) | Best overall, widest fund selection | Limited English |
| Rakuten Securities (楽天証券) | Easy app, Rakuten ecosystem | Partial English |
| Matsui Securities (松井証券) | Beginners, no account fees | Japanese only |
| auカブコム証券 | au/KDDI users | Japanese only |
SBI Securities and Rakuten Securities are the most popular choices for foreigners because they have more English-language information available online.
Step 2 — Apply Online
Most brokers allow online application:
- Visit broker website
- Fill out application form (Japanese, but manageable with Google Translate)
- Submit copies of: Residence card, My Number card/notification slip
- Wait 1–2 weeks for account approval by mail
- Log in and set up your NISA account
Step 3 — Link a Bank Account
Connect your Japanese bank account for deposits. Rakuten Securities pairs naturally with Rakuten Bank.
Step 4 — Choose Your Investments
What Should Foreigners Invest In?
For most beginners, index funds are the right starting point.
Top Recommended Funds for NISA
| Fund | Type | Expense Ratio |
|---|---|---|
| eMAXIS Slim 全世界株式（オール・カントリー） | Global stocks | 0.05775% |
| eMAXIS Slim 米国株式（S&P500） | US S&P500 | 0.09372% |
| ニッセイ外国株式インデックスファンド | Developed market stocks | 0.09889% |
The eMAXIS Slim All Country fund is the most popular choice — it gives you instant diversification across the entire global stock market at an extremely low cost.
Tsumitate vs Growth NISA
Tsumitate (積立) NISA
- Monthly automatic purchases
- Only qualified mutual funds (screened for long-term investment)
- Limit: ¥1.2M/year
- Best for: Beginners, hands-off investors
Growth (成長) NISA
- Can buy stocks, ETFs, REITs, investment trusts
- Limit: ¥2.4M/year
- Best for: More active investors who want individual stock picks
You can use both simultaneously (total ¥3.6M/year).
Tax Considerations for Foreign Residents
- Japan-source dividends and gains: NISA eliminates Japanese tax completely
- Home country taxes: Depending on your country, your home country may tax gains even if Japan doesn’t. Check with your home country’s tax authority.
- Withholding tax on US stocks: Even inside NISA, US dividends are subject to 10% US withholding tax (unavoidable)
- When you leave Japan: You may need to close your NISA account or transfer to a taxable account — rules vary
Monthly Investment Strategy
A simple approach for beginners:
- Open Rakuten Securities + Rakuten Bank
- Set up automatic monthly purchase of ¥50,000 in eMAXIS Slim All Country
- Increase when possible, never panic sell
- Reinvest dividends automatically
Over 10–20 years, consistent investing in diversified global funds has historically generated 7–10% annual returns.
Resources to Learn More
- Tsumiki Financial (Japanese) — Beginner-friendly Japanese investing blog
- Money Forward ME — Track all your Japanese accounts and investments in one place
- r/japanfinance (Reddit) — Excellent English community for financial questions in Japan