As you may know, there are a wide variety of expenses available for investing in stocks, and if you use these expenses well, you can minimize the amount of tax you pay to the tax office .
Of course, even if you hear this story, what kind of expenses can be used as expenses for stock investment, and you cannot enjoy this merit unless you know how to report expenses related to stock investment.
Therefore, on this page, the author of an active stock investor who holds a qualification as a financial planner has summarized a list of expenses recognized as expenses in the world of stock investment and the procedure for applying for expenses .
Table of contents
- 1 Expense items for stock investment
- 2 Final tax return is required to apply for expenses
- 3 Frequently Asked Questions
- 3.1 How to handle expenses before the previous year
- 3.2 What to do if you do not have a receipt?
- 3.3 Is there any merit in establishing a company?
- 3.4 What happens to capital gains?
- 4 Ask a tax professional what to do
Expense items in stock investment
In the first place, in order to use a convenient expense application, it is essential to understand what is recognized as an expense in equity investment.
Therefore , I have listed the items that are usually accepted as expenses among various expenses related to stock investment .
- Office fee used to buy and sell stocks
- PC fee purchased for trading
- Communication costs
- Stock investment related seminar fee
- Book fee
- Expenses for social gatherings with fellow stock investors
- Other stock investment related costs
What we can say from this list is that the costs that can be expensed for equity investments are limited to the costs required to engage in equity investments .
In other words, even if it does not correspond to the items mentioned here, in principle, all expenses that the tax office recognizes as “necessary to make a profit from stock investment” can be expensed.
When you hear this story, you may think that the cost is great, but the point of this story is that it needs to be approved by the tax office.
Considering this point, it is necessary to submit an expense application document to the tax office to see if it is recognized as an expense, and have the government office judge that “this will be an expense for stock investment”.
Final tax return is required for expense application
Actually, in order to apply for expenses incurred in stock investment, you will have to calculate the expenses yourself as shown in this heading and file a final tax return yourself .
Because, in the case of a “specific account type securities account” used by many people, the securities company will automatically calculate the amount of profit generated in the account, but among them, the stock investment you used Because the cost is not listed.
In other words, in order to apply for expenses for stock investment, it is necessary to grasp all the costs related to stock investment incurred in that year and enter the amount in the final tax return documents.
By the way, the main items that are required to be included in the final tax return application documents are as follows.
- Profit generated by stock investment
- Amount to apply for expenses
- Taxable amount minus 1 minus 2
Regarding the amount of expense application, the tax office staff may call you to confirm after submitting the final tax return. If this confirmation cannot be obtained, not only will the expense application not be accepted, but there is a risk that it will be regarded as a false declaration.
Considering this risk, it is essential to keep a receipt or receipt that describes the amount of money you applied for when you apply for expenses for stock investment.
List of frequently asked questions
After reading the contents so far, you should have somehow understood the cost application procedure for stock investment and the costs that can be applied for as expenses in stock investment.
However, the point here is that understanding the procedure for applying for expenses is completely different from being able to apply for expenses properly .
Therefore, here we will introduce in QA format the points that you absolutely want to keep in mind when using the very convenient expense application in the world of stock investment. By the way , the items to be taken up in QA format this time are as follows .
- How to handle expenses before the previous year
- How to file if you do not have a receipt
- Benefits of establishing a company
- Expenses for capital gains
The contents of each item mentioned here will be introduced in order from the top.
How to handle expenses before the previous year
One of the points that everyone cares about when applying for expenses related to stock investment is whether or not to apply for expenses incurred before last year.
What this means is whether you can apply for the required costs used in 2016 and 2015 as of 2018.
In principle, this is possible .
This is because if you have already filed your tax return, you can file an additional tax return. Also, if you have not filed your tax return, you can file your tax return yourself, so it is very easy to apply for additional expenses .
However, it is up to the tax office to decide whether to amend the final tax return or approve the tax return for the next fiscal year or later, so confirmation with the tax office is essential.
What to do if you don’t have a receipt?
The next question is whether you can apply for expenses even if you do not have a receipt certifying the expenses incurred when you apply for expenses related to stock investment.
This is very gray, but in principle you can apply for expenses without a receipt .
This is because you are not required to submit a receipt or receipt for payment items when filing your tax return. Therefore, even if you do not have a receipt, if it is incurred as an expense, we recommend that you declare it for the time being.
However, since there is a possibility that you will be required to submit a receipt for the item for which you applied for expenses at a later date, please make your own judgment.
Is there any merit in establishing a company?
As a general rule, the expense application items that can be used for stock investment are wider for corporations than for individuals.
For this reason, isn’t it better to establish a company, commercialize it, and invest in stocks? Not a few people wonder.
This is a case-by-case basis, so I can’t say it unconditionally, but if you aren’t making a big profit from your equity investment, it’s safe to refrain from establishing a company .
This is because there are various costs involved in starting a company.
Considering this cost, even if the range of expense applications is widened, it would be more profitable to invest in stocks as an individual as a result … Cases can easily occur.
Considering this point, it is recommended that you consider that establishing a company has a great disadvantage if you do not generate profits (5 million yen or more per year) that are worth commercializing from stock investment.
What happens to capital gains?
Expense application items vary depending on whether profits generated from stock investment are classified as miscellaneous income or capital gains.
In terms of this expense application subject, the expense-related rules introduced so far are in the case where the profit generated from stock investment is counted as miscellaneous income instead of capital gains.
In other words, the stock investment-related book fees and seminar participation fees introduced so far are not subject to expenses when capital gains are applied .
By the way, the rules for recording the profit of stock investment in capital gains, which we have taken up this time, are summarized on the official website of the National Taxation Bureau, which is introduced here.
Ask a tax professional if anything
If you keep the contents so far, the basics related to expenses that are important for stock investment are perfect.
However, the problem here is that the case discussed here is just a principle case of expense processing related to stock investment . In other words, there are exception cases.
For example, there are cases where applications for rent, which normally cannot be applied for expenses by stock investment, are accepted as an exception.
It is the tax office staff and tax accountant that I would like to use when getting the opinions of this tax-related professional.
First of all, the former tax office staff can be consulted free of charge by calling. This consultation service will answer some questions.
And the latter tax accountant is just a tax professional. It costs money to talk to them, but they will tell you the best way to save tax, so if you want to take thorough tax measures, there is no reason not to use it.