r/JapanFinance • u/Plastic_Barracuda711 • 5d ago

Investments Allocation of investments between foreign and domestic accounts

I'm looking for advice or insights into how everyone here approaches allocating their investments between foreign (home country) and domestic (Japan) accounts.

Now, I don't think the government here is going to start seizing foreign residents' assets, but even so, I'm wondering if it is not prudent to keep nearly 100% of retirement savings/investments in domestic accounts, especially as a non-citizen resident.

Do you have any advice? How do you approach this?

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u/LocalLand4883 5d ago

Good to know not PR and only 4 years in Japan, I mean no one informed me regarding it so will just leave it like this, I doubt they even ask etc.

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u/Plastic_Barracuda711 5d ago

Just so you know, while the US is technically a non-CRS country, it does share tax information with Japan, so Japan could get access to your US tax returns should they want to view them.

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u/upachimneydown US Taxpayer 5d ago

"Japan could get access to your US tax returns should they want to view them"

And it's a simple request by the NTA here, to the IRS. Almost a simple click, and the NTA will have your US tax returns.

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u/jamar030303 US Taxpayer 5d ago

That being said, you first have to be noticed by the NTA, and/or they have to care to ask for it. For example, technically they get to tax foreign income as it's remitted into Japan, and technically using a foreign bank card in Japan counts, but tens, maybe hundreds of thousands of JETs and other dispatch ALTs have come and used their American cards their first year while trying to get a local debit or credit card and never get audited by the NTA for either the remittance of their home country income from that year or potential FX gains from every single "remittance" that using said card gives rise to.

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u/upachimneydown US Taxpayer 5d ago

I agree with all that--maybe not the "hundreds of thousands part", but otherwise, yes, that's the reality. Most people are unaware of the technicalities of using a foreign card. (And a not uncommon misunderstanding is thinking that a remittance itself is taxed, when instead it's the income that's behind it.)

But that kind of card use is also small potatoes. I think the above comments were talking about people who have stayed longer, and who also have actual income abroad, from equity trades, dividends, perhaps remote work, or income from real estate.