Compound Savings Calculator (Taxed Each Period, After-Tax)
Estimate the after-tax maturity amount of a compound savings plan that is taxed every time interest accrues, from your monthly contribution, annual rate, term, and tax rate. Also shows total principal, after-tax interest, and the effective annual rate.
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Input
The default is Japan's 20.315% flat withholding tax (15% income tax + 0.315% special reconstruction income tax + 5% residents' tax). It is deducted each time interest is taxed.
Result
Maturity amount (after tax)
9,220,143yen
Total principal
7,200,000 yen
Interest after tax
2,020,143 yen
(Ref.) Effective annual rate
2.417 %
This is an estimate for a model taxed at 20.315% each time interest accrues. If instead taxed in a lump sum at maturity, you would receive about 9,310,903 yen, a difference of about 90,760 yen from this model (per-period taxation is lower).
How it works
- Calculations use an ordinary annuity model that saves a fixed amount at the end of each month and compounds monthly. It assumes 'per-period taxation,' where the tax portion is deducted each time interest accrues.
- The after-tax effective monthly rate is r' = (annual rate รท 100 รท 12) ร (1 โ tax rate รท 100). Because interest is taxed each time, the rate that is actually reinvested shrinks by the tax portion.
- The maturity principal-plus-interest is FV = monthly contribution ร {(1 + r')^n โ 1} รท r' (n is the number of saving months). When r' is 0, it is monthly contribution ร n.
- Total principal is monthly contribution ร number of saving months, and after-tax interest is the maturity amount minus total principal. The effective annual rate is a reference value obtained by annualizing the after-tax monthly rate as (1 + r')^12 โ 1.
- For reference, it also computes the amount for a 'lump-sum taxation at maturity' model that invests pre-tax and taxes everything at maturity, then shows the difference from the per-period taxation model. The longer the compounding period, the larger the difference.
- The default tax rate is Japan's 20.315% flat withholding tax (15% income tax + 0.315% special reconstruction income tax + 5% residents' tax). Actual yields, tax methods, fees, and tax-exempt schemes such as NISA are not considered, so results are only estimates.
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