iDeCo instead of NISA to “balance out” tax hit in second year in Japan?

I recently arrived in Japan with a 5 year HSP visa and am currently researching/planning iDeCo/NISA investments.

I'm not American in case that's relevant. (German)

Background to my question:

  • Before coming to Japan I held ETFs, but had to sell them on short notice now (after moving to Japan) b/c the German broker I used requires customers to reside in Germany (maybe cold have moved the ETFs to IBKR but seemed like a hassle, so I "cashed out")
  • Being in my first year in Japan, I pay very low taxes
  • As a personal preference, I think NISA (investing in some Japanese global index fund into the つみたて枠) as a very hands off option (set up monthly payment and "forget") fits me well

but …

Question:

  • having sold my ETFs I have a large sum of extra income that will be now taxed in Japan if I understand correctly
  • Would it be possible to set up iDeCo and invest an equivalent sum (or the iDeCo limit) to reduce my income for this year?

thanks in advance for any help 🙂

by FairMair

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