CA I get. I used to have one and had no issues with reclaiming the withheld 15%. Just wondered whether you left out JP intentionally, it being the bigger market.
For JP, I’m getting withheld 15% (same as IE-based ETFs report), whereas I read 10% in the treaty. In some years, a reclaim of full 15% went through. In another, it was corrected down to 10%. Haven’t tried reclaiming the remaining 5% in JP directly, yet.
On this page from Steueramt ZH (in German), there’s a link to this PDF DA-1 Antrag für natürliche Personen 2023 which contains a table of WHT percentages per country. The value for Japan is 10%.
Maybe that changed sometime back, or you got lucky and the person handling your taxes didn’t know it should be 10% instead of 15%?
Can you give information about specific ETFs with JP domicile on JP stocks? And maybe some more details about how you buy it, anything tricky (besides staying awake between 1 and 7 am to place orders)?
iShares offers for example ETFs on the Nikkei 225 (Symbol: 1329, ISIN JP3027710007) and TOPIX (Symbol 1475, ISIN JP3048120004), both with 0.045% TER and large enough AUM.
Think of Nikkei 225 as large-cap price-weighted index like the Dow Jones, TOPIX as a broad, market-cap weighted index like total US.
Nothing tricky about it, tradable like any other instrument, if your broker covers TSE. Same for FX. Symbols are numbers and JPY values seem high if you are used to CHF, USD or EUR.
I do a limit order every few months or even longer, whenever it’s JP’s turn as per my asset allocation, so I don’t mind the trading hours.
Hi,
I bought a Japanese ETF last year (TOPIX, JP3048120004). Did you manage to get the 5% back from the Japanese tax office? (the difference between the 10% of the treaty and the 15% WHT). I am considering to apply for it if it is feasible, although I didn’t manage to find the right form in their website.
Unfortunately not. Basically, I got stuck and then it slipped my mind. It starts with where to send it to, which isn’t the JP tax office but the payer or clearing agent iirc. Other (official) pages then mention a local tax office in the context of non-residents again.
My broker offers some services on tax vouchers or relief, but explicitly excluded Japan from that.
I’d have to search the forms again, it was a bit of a mess to find the right ones.
Please share if you have new or different information.
For locals, sure, but that’s not a reclaim. JP residents would also need to handle specific forms, get a resident confirmation and ensure formal consistency.
But yes, at least the instructions are more simple and it’s clear where they’d have to send it to 
And it’s likely more established for foreign retail investors.
Maybe it’s straightforward, after all and I just missed the point.
So Crunchy, any hint is welcome 
Yes, it is. Swiss withholding tax and US withholding tax (though DA-1) is a reclaim.
In any case, having spent two years in Japan, I feel for you. Their bureaucracy is extremely efficient, once you have spent several hours figuring our their understanding of efficiency
That’s a nice way of seeing it
The DA-1, I’d consider more of a credit. Either way, our DA-1 reclaim is a different process, with less documents required from what a foreign investor of CH stocks needs to go through to reclaim overpaid CH taxes in CH (not his resident country).
For example, also CH would ask for a tax voucher from a foreign broker. Once they charge a fee for that (if they offer it in the first place), you already prevent all the smaller investors, the effort to fill the paperwork aside. For DA-1, we put in some numbers, add some standard PDF report and that’s it
I’ve done some further research for JP. It doesn’t seem possible to claim the overpaid WHT as a private person to the Japanese Tax Office (link), but it has to be done through the payer.
(…) by submitting both the form and an “Application Form for Refund of the Overpaid Withholding Tax in accordance with the Income Tax Convention (Form 11)” (hereinafter referred to as the “Application for Refund”) through the payer at a later date to the district director of the competent tax office, the non-resident, etc. may apply for a refund of the difference between the withholding tax amount
I understand that the payer is the broker. I have my Japanese ETF in Interactive Brokers. They don’t seem to give any such service according to this FAQ
Foreign stocks listed for trading in Japan which issue dividends will have the cash dividend allocation subject to an increased withholding tax rate. The tax will vary based on the domicile of the stock issuing the dividend; however in general the withholding rate will be the highest withholding rate applicable and will not incorporate a reduction based on prevailing tax treaties.
This treatment is due to the tax reporting status of our clearing agent. As our clearing agent is unable to process the relevant tax declaration documentation which would allow for the application of tax withholding at a reduced rate, shareholders will be subject to the highest rate.
In order to avoid the application of the tax withholding on the dividends of foreign stocks, positions in such dividend paying stocks should be closed prior to the ex-dividend date.
I wonder if other brokers (Saxo? Degiro? Swissquote?) allow you to apply for the reduction of the Japanese WHT from 15.315% to the 10% of the treaty. It’s a pity to lose this 5.315%. For last year’s dividend yield of 2.2%, it means a loss of 0.12% per year.
In the meanwhile, the Japanese ETF seems to have a TER and tax advantage with respect to a IE-based one: TER is only 0.05%, and this tax leak of 5.315% on the dividends (loss of 0.12% per year) is still smaller than the 15% for an Irish fund (so around 0.30% per year).
I think this is a great topic with relevant information. I am therefore starting a new thread to make this valuable information more easily accessible for future references.
Fortsetzung der Diskussion von Tax optimisation for ETF investing [2024]:
Foreign stocks listed for trading in Japan which issue dividends will have the cash dividend allocation subject to an increased withholding tax rate. The tax will vary based on the domicile of the stock issuing the dividend; however in general the withholding rate will be the highest withholding rate applicable and will not incorporate a reduction based on prevailing tax treaties.
Thanks for creating the new thread!
So summarizing from the previous thread:
Got the same conclusion, incl. the message from IB you quoted in the other thread.
Back to start, a deja vu for me 
I understand it’s either the custodian of the ETF, or the custodian of your broker that’s the registered unit holder. Checked the English fund documents out of curiosity, but didn’t get me any further.
Hang on. I thought the unrecoverable tax is 5% of those 2.2%, which is, like 0.011%. And if Japan is about 5% of your holdings (as per market cap weighing), it’s 0.00055%, a rounding error. Or am I missing something?
Oh, right. So 0.0055% overall TER. Getting close to the difference i would see in my spreadsheet, but, frankly, still small compared to other things that vary.
Well, the tax optimization part is up to +0.33% compared to a non-local option. Besides, the next best European one for that index standalone has a 4x higher TER (+0.15%), with 2% of the AUM.
But anyway, if you already have it (or any other JP stocks), for whatever reason not in scope of this topic, and you overpaid foreign WHT, I see no reason to belittle the effort to reclaim the money, which might yet be double or triple-digits per year 
Actually, when I bought the Japanese ETFs last year, the EU based ETFs I searched for comparison all had a TER of 0.15% or more. But now, the cheapest one from Amundi has a TER of 0.05%, they have probably reduced their fees.
Amundi Prime Japan UCITS ETF DR (D), LU1931974775, ticker PR1J ( accumulating version is Amundi Prime Japan UCITS ETF DR (C), LU2089238385), TER 0.05%.
I’ll run the numbers again to see what the advantage of the JP based ETF is.
Then it’s down to 10% reclaimable wht, some 0.2%. Even trading and fx cost are roughly the same.
I’d give style points for Topix as the renowned index for Japan. Plus, it includes small caps, it should have a slightly bigger market coverage, with roughly 5x the numbers of companies included.
Also one fewer jurisdiction to deal with in the chain.
