NISA for Foreigners: The Complete Guide to Tax-Free Investing in Japan

Last updated: October 2026

Japan offers one of the most generous tax-free investment programs in the world. It's called NISA, and it lets you invest up to ¥3.6 million per year, with a lifetime cap of ¥18 million, completely free of capital gains tax and dividend tax. No tax on profits when you sell. No tax on dividends while you hold. No time limit on the exemption.

The catch? NISA was designed for Japanese nationals. The official documentation is in Japanese, brokerages rarely have English support, and the guides that do exist in English tend to skip the hard questions: What happens to your account when you leave Japan? Can US citizens avoid PFIC penalties? How do you report NISA gains to your home country's tax authority?

This 7-part series answers all of it.

Disclaimer: This series is for informational purposes only and does not constitute financial, investment, or tax advice. Consult qualified professionals for guidance tailored to your situation.

October 2026 Update

The core numbers have not changed: ¥3.6 million a year, ¥18 million in total, tax-free with no time limit. Three changes are worth knowing, all covered in ①:

• Children's NISA from January 2027. Residents aged 0 to 17 get a Tsumitate quota of ¥600,000 a year and ¥6 million in total, managed by a parent, with withdrawals allowed from age 12 for the child's own expenses.
• A wider Tsumitate menu. Two Japanese equity indices were added in April 2026, and funds investing mainly in bonds can now qualify.
• iDeCo limits rise from December 2026. Company employees can contribute up to ¥62,000 a month and the self-employed up to ¥75,000, which changes the trade-offs in ⑥.

We have also corrected brokerage information that had gone stale: IBSJ has offered NISA since July 2025, and it is not the only brokerage that sells US-listed ETFs in NISA.

Start With Your Situation

"What is NISA and should I use it?"

→ ① NISA Explained: Japan's Tax-Free Investment Account for Foreign Residents The complete overview: how the tax exemption works, Tsumitate (¥1.2M) and Growth (¥2.4M) quotas, the ¥18M lifetime cap, eligibility for foreign residents, and what happens when you leave. Start here.

"I want to open an account."

→ ② How to Open a NISA Account as a Foreigner in Japan Required documents (residence card, My Number), brokerage comparison (SBI, Rakuten, IBSJ, Nomura), the 5-step process, common rejection reasons and fixes, realistic timeline.

"What should I invest in?"

→ ③ Tsumitate vs Growth Investment: Which NISA Type Should You Choose? How the two quotas differ, eligible products for each, strategies by nationality and length of stay, combined allocation examples.

→ ④ Best Investment Funds for NISA: A Foreigner's Guide eMAXIS Slim All Country vs S&P 500, 7 top funds compared by cost and coverage, the double currency risk for foreigners, US-domiciled ETFs for American citizens (VT/VOO/VTI), sample portfolios.

"I'm leaving Japan: what do I do?"

→ ⑤ Leaving Japan? What Happens to Your NISA Account Default account closure rules, the continuation application (up to 5 years for employer transfers), brokerage-by-brokerage policies, four realistic scenarios for foreign residents, pre-departure checklist and timeline.

"Should I also use iDeCo?"

→ ⑥ NISA vs iDeCo: Which Is Better for Foreigners in Japan? Liquidity vs lock-up, how departure rules differ, the triple tax benefit vs single tax benefit, the lump-sum withdrawal option for non-Japanese nationals, priority by length of stay, side-by-side simulations.

"What about taxes in my home country?"

→ ⑦ NISA and Your Home Country Taxes: What Foreign Residents Must Know Why NISA's tax-free status doesn't cross borders, US FATCA/FBAR/PFIC obligations in detail, UK/Canada/Australia/EU treatment, the foreign tax credit gap, reporting checklist by country.

US Citizens: Read These First

If you hold US citizenship or a green card, your NISA strategy is fundamentally different from everyone else's. The IRS taxes your worldwide income regardless of where you live, and Japanese investment trusts are classified as PFICs, which triggers punitive US taxation. Three articles address this directly:

1. ④ Best Investment Funds for NISA: All Japanese mutual funds are PFICs. Your only viable path: US-domiciled ETFs in the Growth quota.
2. ⑦ Home Country Taxes: FBAR, FATCA, PFIC reporting obligations and how to stay compliant.
3. ① NISA Explained: Full system overview with a dedicated US citizen section.

Reading Routes

You don't need to read all seven articles. Pick the route that matches where you are.

Route A: Getting Started (3 articles)

① Overview → ② Open Account → ④ Choose Funds

Route B: Already Have an Account (2 articles)

③ Quota Strategy → ④ Fund Selection

Route C: Preparing to Leave Japan (2 articles)

⑤ Departure Procedures → ⑦ Home Country Taxes

Full Series Index

NISA Quick Reference

Annual investment limit: ¥1.2M (Tsumitate) + ¥2.4M (Growth) = ¥3.6M total Lifetime investment limit: ¥18M (of which Growth can be up to ¥12M) Tax-free: Capital gains, dividends, and distributions Tax-free period: Indefinite (no expiration) Eligibility: Japanese tax resident aged 18+ with registered address (children aged 0 to 17 can use a separate Tsumitate quota from January 2027) Required documents: My Number, residence card, identity verification When you leave: Account closes by default (exception: employer-directed transfer, up to 5 years)

Articles in this series are updated regularly to reflect system changes and brokerage policy updates.