Act on Special Measures Concerning Taxation

Income tax is not imposed on dividends and similar income as prescribed in Article 24, paragraph (1) of the Income Tax Act (excluding dividends, etc. from distributions of proceeds of privately placed bond-based investment trusts, etc. prescribed in Article 8-2, paragraph (1) and dividends and similar income on foreign privately placed bond-based investment trusts, etc. prescribed in Article 8-3, paragraph (1); hereinafter referred to as "dividends and similar income" in this Article and the following Article) on listed shares, etc. in a tax-exempt account prescribed in Article 37-14, paragraph (1) (hereinafter referred to as "listed shares, etc. in a tax-exempt account" in this Article), which are to be received by a resident, or a nonresident who has a permanent establishment, who has opened a tax-exempt account prescribed in Article 37-14, paragraph (5), item (i) (hereinafter referred to as a "tax-exempt account" in this Article) at a business office (meaning a business office prescribed in that paragraph; the same applies in the following Article) of a financial instruments business operator, etc. prescribed in Article 37-14, paragraph (1) (hereinafter referred to as a "financial instruments business operator, etc." in this Article and the following Article), and which are listed below (limited to those for which the financial instruments business operator, etc. is a person in charge of handling payment in Japan who is specified by Cabinet Order; hereinafter referred to as "dividends and similar income on listed shares, etc. in a tax-exempt account" in this Article and Article 37-14, paragraphs (41) and (45)).

the following dividends and similar income on listed shares, etc. in a tax-exempt account held in a tax-exempt management account prescribed in Article 37-14, paragraph (5), item (iii) that has been established in the tax-exempt account, which are to be received during the period from the date on which the tax-exempt management account was established until the date on which five years have elapsed from January 1 of the year that includes that date;

dividends and similar income on shares, etc. listed in Article 37-11, paragraph (2), item (i), other than those received from a domestic corporation by a person who, as of the record date prescribed in Article 8-4, paragraph (1), item (i) pertaining to the payment of the dividends and similar income paid by the domestic corporation, holds shares or capital contributions whose number or amount accounts for 3 percent or more of the total number or the total amount of issued shares (meaning issued shares as prescribed in that item) of or capital contributions to the domestic corporation;

distributions of proceeds from a securities investment trust other than a bond investment trust for which the public offering of beneficial rights upon its creation was conducted by way of a public offering prescribed in Article 8-4, paragraph (1), item (ii) (excluding a specified stock investment trust);

dividends and similar income on investment units of a specified investment corporation listed in Article 8-4, paragraph (1), item (iii).

the following dividends and similar income on listed shares, etc. in a tax-exempt account held in a cumulative investment account prescribed in Article 37-14, paragraph (5), item (v) that has been established in the tax-exempt account, which are to be received during the period from the date on which the cumulative investment account was established until the date on which 20 years have elapsed from January 1 of the year that includes that date;

distributions of proceeds on those beneficial rights in securities investment trusts other than bond investment trusts which fall under shares, etc. listed in Article 37-11, paragraph (2), item (i);

distributions of proceeds listed in (b) of the preceding item.

dividends and similar income listed in (a) or (b) of the preceding item on listed shares, etc. in a tax-exempt account held in a specified cumulative investment account prescribed in Article 37-14, paragraph (5), item (vii) that has been established in the tax-exempt account, which are to be received on or after the date on which the specified cumulative investment account was established;

dividends and similar income listed in item (i), (a) through (c) on listed shares, etc. in a tax-exempt account held in a specified tax-exempt management account prescribed in Article 37-14, paragraph (5), item (viii) that has been established in the tax-exempt account, which are to be received on or after the date on which the specified tax-exempt management account was established.

Where, with respect to a tax-exempt account or specified taxable minor's account of a resident, or a nonresident who has a permanent establishment, who opens a tax-exempt account and a specified taxable minor's account prescribed in Article 37-14, paragraph (5), item (ix), an event of non-performance of contract, etc. prescribed in paragraph (6) of that Article (hereinafter referred to as an "event of non-performance of contract, etc." in this paragraph and the following paragraph) occurs by December 31 of the year preceding the person's reference year prescribed in paragraph (4), item (i) of that Article, the provisions of this Act and the Income Tax Act apply by deeming that the provisions of the preceding paragraph did not apply to the dividends and similar income on listed shares, etc. in a tax-exempt account listed in item (iii) of that paragraph to be received during the period from the time of the opening of the tax-exempt account until the time of the occurrence of the event of non-performance of contract, etc., and that the dividends and similar income on listed shares, etc. in a tax-exempt account were paid at the time of the occurrence of the event of non-performance of contract, etc.

The provisions of Article 8-5, paragraph (1) are to be applied to dividends and similar income on listed shares, etc. in a tax-exempt account to which the provisions of the preceding paragraph have been applied, notwithstanding the provisions of paragraph (4) of that Article, for each total of the amount of dividend income pertaining to the dividends and similar income on listed shares, etc. in a tax-exempt account deemed to have been paid at the time of the occurrence of the event of non-performance of contract, etc. referred to in the preceding paragraph.

Beyond what is provided for in the preceding paragraph, matters concerning the payment of income tax collected by the financial instruments business operator, etc. referred to in paragraph (1) on dividends and similar income on listed shares, etc. in a tax-exempt account to which the provisions of paragraph (1) are deemed not to have applied pursuant to the provisions of paragraph (2), and other necessary matters concerning the application of the provisions of paragraph (2), are specified by Cabinet Order.

Income tax is not imposed on the dividends and similar income on listed shares, etc. in a minor's account prescribed in Article 37-14-2, paragraph (1) (hereinafter referred to as "listed shares, etc. in a minor's account" in this paragraph) which are listed in paragraph (1), item (i), (a) through (c) of the preceding Article and which a resident, or a nonresident who has a permanent establishment, who has opened a minor's account prescribed in Article 37-14-2, paragraph (5), item (i) (hereinafter referred to as a "minor's account" in this Article) at a business office of a financial instruments business operator, etc. is to receive within the period specified in each of the following items for the category of listed shares, etc. in a minor's account listed in that item (limited to those for which the financial instruments business operator, etc. is a person in charge of handling payment in Japan as prescribed in that paragraph; hereinafter referred to as "dividends, etc. on listed shares, etc. in a minor's account" in this Article and Article 37-14-2, paragraphs (27) and (31)).

listed shares, etc. in a minor's account held in a tax-exempt management account prescribed in Article 37-14-2, paragraph (5), item (iii): the period from the date on which the tax-exempt management account was established in the minor's account until the date on which five years have elapsed from January 1 of the year that includes that date;

listed shares, etc. in a minor's account held in a continuing management account prescribed in Article 37-14-2, paragraph (5), item (iv): the period from the date on which the continuing management account was established in the minor's account until December 31 of the year preceding the year in which the person who opened the minor's account is 18 years of age as of January 1.

If, by December 31 of the year preceding the reference year prescribed in Article 37-14-2, paragraph (4), item (iii) of a resident, or a nonresident who has a permanent establishment, who opens a minor's account and a taxable minor's account prescribed in paragraph (5), item (v) of that Article, or by December 31, 2023, whichever is earlier, an event of non-performance of contract, etc. prescribed in paragraph (6) of that Article (hereinafter referred to as an "event of non-performance of contract, etc." in this Article) occurs, the provisions of this Act and the Income Tax Act apply by deeming that the provisions of the preceding paragraph did not apply to the dividends, etc. on listed shares, etc. in a minor's account to be received during the period from the time of the establishment of the minor's account until the time of the occurrence of the event of non-performance of contract, etc., and that the dividends, etc. on listed shares, etc. in a minor's account were paid at the time of the occurrence of the event of non-performance of contract, etc.

The provisions of Article 8-5, paragraph (1) are to be applied to dividends, etc. on listed shares, etc. in a minor's account to which the provisions of the preceding paragraph have been applied, notwithstanding the provisions of paragraph (4) of that Article, for each total of the amount of dividend income pertaining to the dividends, etc. on listed shares, etc. in a minor's account deemed to have been paid at the time of the occurrence of the event of non-performance of contract, etc. referred to in the preceding paragraph.