NISA Changes 2027: Children's NISA and What Foreigners Get

Quick Answer: Japan's NISA is a tax-free investment account: up to ¥3.6 million a year, a ¥18 million lifetime cap, no time limit. A reform passed in March 2026 adds a children's NISA from January 2027: ages 0–17, ¥600,000 a year, ¥6 million cap, withdrawals only from age 12. For foreigners, the catch is residency: leaving Japan generally ends the account.

NISA (少額投資非課税制度) is Japan's tax-free investment account — the country's main tool for moving households "from savings to investment." For foreign residents, it is often the simplest, most powerful tax break available.

It is also about to get broader. The 2026 tax reform, now law, extends NISA to children and widens what the accumulation quota can hold from January 2027. This guide explains, in plain English, what NISA looks like today, what is changing for 2026–2027, and the residency rule that matters most if you might not stay in Japan.

This is educational information, not financial, tax, or legal advice. NISA rules are set by law and administered through brokerages, and broker procedures vary — confirm details against the official sources linked at the end or with a qualified professional.

What is NISA in one minute?

A NISA account holds investments — mainly investment trusts (index and mutual funds) and, in the growth portion, individual stocks and ETFs. Normally, investment gains in Japan are taxed at about 20.315%. Inside a NISA, those gains — dividends and capital gains — are tax-free.

Two features define the current system:

That flexibility is exactly why NISA and iDeCo play different roles in a plan, which we'll come back to.

What does NISA look like today?

The "new NISA," in force since January 2024, has two quotas you can use at the same time:

Annual limit Role
Tsumitate (accumulation) quota ¥1,200,000 Regular investing into approved funds
Growth quota ¥2,400,000 Funds plus individual stocks and ETFs
Combined per year ¥3,600,000 Use both together

On top of the annual limits there is a lifetime tax-free holding cap of ¥18,000,000 (the growth quota can fill up to ¥12,000,000 of that). The tax exemption has no time limit, and if you sell holdings, the lifetime cap frees back up and can be reused in a later year.

To open a NISA today you must be a resident of Japan aged 18 or over with a My Number. Each person may hold one NISA account at a time.

What changes in January 2027?

These are no longer proposals. The fiscal-2026 tax reform bill was passed on 31 March 2026, and the NISA measures take effect in January 2027. Brokers began taking applications for the new children's accounts on 1 October 2026.

1. A NISA for children (こどもNISA). The accumulation (tsumitate) quota opens to children aged 0 to 17. According to the FSA:

Children's NISA Rule
Eligible ages 0–17
Quota Accumulation (tsumitate) only
Annual limit ¥600,000
Lifetime cap ¥6,000,000
Who runs it A parent or guardian, as account manager (口座管理者)
Withdrawals Only from age 12, only with the child's consent, and only for money used for the child
At 18 Moves automatically into an adult NISA and stays tax-free
Starts January 2027

The age-12 rule is the one to plan around. Before 12 the money is effectively locked, apart from narrow exceptions such as disasters, which brokers describe. From 12 the guardian can withdraw, but has to submit a form with the child's written consent and confirm the money is for the child. Treat it as a long-horizon account for the child, not a flexible family savings pot.

Brokers also report that purchases are by regular instalment only, and that money a parent or grandparent puts in counts as a gift. At ¥600,000 a year that sits inside the ¥1.1 million annual gift-tax exemption. Confirm both with your broker and the NTA before relying on them.

2. More funds qualify for the accumulation quota. The product rule changes from mainly-equity funds to funds investing mainly in stocks or bonds, and new indices are added, including the JPX Prime 150, MSCI Japan and the Yomiuri 333. This applies to adult accounts too.

3. Less paperwork. The periodic address check brokers were required to run on NISA account holders is abolished.

The adult limits above are unchanged. These are expansions, not cuts.

Not law yet: in August 2026 the FSA asked, for the fiscal-2027 reform, that lifetime-cap space freed by selling come back in the same year rather than the next, and for clearer rules on ETFs in the accumulation quota. These are requests. The decision comes with the tax reform outline in December 2026.

Can foreigners use NISA?

Yes. Foreign residents of Japan who are tax residents and have a My Number can generally open and use a NISA, the same as Japanese nationals. For many foreigners on a medium-to-long-term stay, it is the most accessible tax-free investing route available.

The children's NISA is also relevant to international families raising children in Japan. The same residency logic applies to the child: the account is for residents of Japan, so a family that may move abroad before the child turns 12 should weigh that against the age-12 withdrawal lock.

The important qualifier is residency — which leads to the question every foreigner should ask before opening one.

What happens to your NISA if you leave Japan?

This is the part most guides gloss over, and it is the mirror image of the iDeCo problem.

NISA's tax-free status is tied to Japanese tax residency. If you leave Japan permanently and become a non-resident:

One exception worth knowing: if you are leaving because your employer is posting you overseas, you can file a continuation notice (継続適用届出書) and keep the NISA's tax-free status while you are away, according to the Japan Securities Dealers Association. Otherwise, filing the departure notice (出国届出書) closes the account. Exact handling varies by brokerage, and procedures can change, so confirm with your specific provider well before you leave — being forced to sell at a bad time is a real risk worth planning around.

This is the key contrast with iDeCo: an iDeCo balance generally stays locked in Japan until your 60s even after you leave, whereas a NISA generally has to be unwound when you go. One traps the money in; the other pushes it out. If a future move abroad is on the table, both belong in the plan. Our companion guide, iDeCo Changes in 2027 for Foreigners, covers the locked-account side, and FIRE in Japan: NISA, currency, and retirement planning shows how both fit a household plan.

NISA or iDeCo — which comes first?

They are not either/or, and they solve different problems:

A common sequence for foreign residents is to use NISA first for flexible, tax-free investing, then add iDeCo once your stay in Japan is stable and your tax rate makes the deduction worthwhile. For households planning across two countries, see expat FIRE and two-country retirement planning.

How PlanTogetherFI helps

NISA is one tax-free, yen-denominated layer of a bigger picture — and for foreigners, one that may not survive a move abroad. PlanTogetherFI is built to model that honestly for couples and cross-border households:

Try the free PlanTogetherFI calculator to see where NISA fits your FI timeline. To start from your take-home pay, the Japan Salary Tax Calculator estimates your net income and monthly investing capacity first.

PlanTogetherFI is for educational planning only. It is not financial, tax, legal, or investment advice. NISA rules are governed by Japanese law and administered by brokerages, and procedures vary by provider — confirm details with the official sources below or a qualified professional.

Frequently Asked Questions

What are the current NISA limits?

Since January 2024, you can invest up to ¥1.2 million a year in the accumulation (tsumitate) quota and ¥2.4 million in the growth quota — ¥3.6 million combined — with a ¥18 million lifetime tax-free holding cap (the growth quota can fill up to ¥12 million of it). The tax exemption has no time limit, and selling holdings frees the lifetime cap back up for reuse.

What is changing about NISA in 2027?

The fiscal-2026 tax reform, passed on 31 March 2026, opens the accumulation quota to children aged 0–17 from January 2027 (¥600,000 a year, ¥6 million lifetime cap, withdrawals only from age 12 with the child's consent, automatic move to an adult NISA at 18). It also widens the funds eligible for the accumulation quota to include bond-mixed funds and more indices.

When can I open a children's NISA (こどもNISA)?

Brokers began accepting applications on 1 October 2026, and the accounts start in January 2027. A parent or guardian opens and manages the account. Withdrawals are only possible from age 12, with the child's consent, for money used for the child.

Can foreigners open a NISA in Japan?

Generally yes. Foreign residents who are tax residents of Japan and have a My Number can usually open and use a NISA on the same terms as Japanese nationals. It is often the most accessible tax-free investing option for medium-to-long-term residents.

What happens to my NISA if I leave Japan?

Because NISA is tied to Japanese tax residency, leaving permanently generally means you can no longer contribute, and the account is typically closed or converted to a taxable account — you may need to sell your holdings before departure. Handling varies by brokerage, so confirm with your provider well ahead of any move.

Should I use NISA or iDeCo first?

They serve different purposes. NISA is flexible and accessible and easier to exit if you leave Japan, but gives no upfront deduction. iDeCo offers a larger upfront tax deduction but locks the money until your 60s. Many residents use NISA first and add iDeCo once their situation in Japan is stable.

Sources and further reading

Figures reflect the law as passed in March 2026 and FSA material to August 2026. Broker procedures for the children's NISA are still being finalised — confirm your own limits and your broker's rules against the official sources or a qualified tax professional.