Taxation of Listed Stocks
Tax Rate:
Net gains from stock sales are taxed at 20.315%.
Tax collection methods:
Through withholding at source, or annual tax return filing.
Securities Account Types:
- Domestic Securities Account: Tax is automatically withheld.
- Foreign Securities Account: Tax must be paid through annual tax return filing.
Special Considerations for Foreign-Issued Stock Options:
When stocks acquired through foreign-issued stock options are held in foreign securities accounts (common scenario), the capital losses cannot be offset against dividend income nor be carried forward to future tax years.
Note: Generally, use the closing rate on the transaction date (or previous day’s rate if unavailable) published by a major Japanese bank.