Japan Tax Reporting of U.S Mutual Funds

[ichiokuen]

Hi again,

Does anyone have experience with the accounting software freee? Or just reporting capital gains in general.

In freee, for capital gains I am listing my stocks as 一般 but I am having trouble getting the better tax rate for my long term capital gains. They are supposed to be taxed on only 50 percent of the gain, right?

Thank you!

[TokyoWart]

In freee, for capital gains I am listing my stocks as 一般 but I am having trouble getting the better tax rate for my long term capital gains. They are supposed to be taxed on only 50 percent of the gain, right?

I have never heard of that

[ichiokuen]

https://tinyurl.com/4k43r3tx

It's really good if you're using the blue tax return.
It's called freee but it's actually 12,000yen a year. Their support used to be really good but recently it's almost impossible to get any help.

[TokyoWart]

Sorry, I meant I have never heard that long term capital gains would only be taxed at only 50% of the gain. I thought the tax rate is set at 20.315% (or 15% for the national portion) regardless of whether the gain was in an ippan or tokutei account.

[ichiokuen]

I found this, on this website: https://www.m-ogido.com/tax_topics/income_tax/341/

株式等
収入金額－（取得費＋譲渡費用）
総合課税
短期譲渡所得
収入金額－（取得費＋譲渡費用）－50万円
長期譲渡所得
収入金額－（取得費＋譲渡費用）－50万円（短期の残額）


総合課税には、特別控除額50万円があり、短期譲渡所得から優先的に控除します。
なお総合課税の長期譲渡所得で、総所得金額に算入される（課税の対象になる）のは2分の1です。

I have seen this same explanation on other sites, but haven't seen it on the government tax site.

[TokyoWart]

My understanding of the website is it's showing that as the calculation for capital gains taxes if you apply 総合課税 but I only have experience with 分離課税. If I understand the system correctly, when you use 総合課税 these capital gains can boost your tax bracket for all of your income (salary, business, etc.) which can make you lose eligibility for some kinds of deductions but there are cases where it works out to a lower tax liability than 分離課税 and of course marginal tax brackets only apply stepwise (i.e. only the amounts above each transition point have the higher tax rate).

[ichiokuen]

Ah, yeah, makes sense! So it might involve a lot of work doing all the calculations to see which one is more advantageous. Also, there might be special rules making this impossible to use for foreign stocks.

Thanks again!

[ichiokuen]

By the way, TokyoWart, do you know if stock sell capital losses can be used against stock sell capital gains?

Last year, the guy at the tax office said that I cannot use losses against gains for foreign stocks! In other words, no mercy!

[TokyoWart]

My experience is that you can use foreign losses against foreign gains but not against dividends (foreign or Japanese) or Japanese capital gains.

[mule96]

By the way, TokyoWart, do you know if stock sell capital losses can be used against stock sell capital gains?

Last year, the guy at the tax office said that I cannot use losses against gains for foreign stocks! In other words, no mercy!

At least for for a Tokutei-Kouza at SBI, this is not the case. For a foreign ETF, which I sold at loss I got the corresponding value credited to my JPY account. I would assume that SBI knows what they are doing. I remember something, that for Online Brokers, which are not registered in Japan, you can use losses againt capital gains - but I may be wrong on that.