Spread betting forex tax free
The general assumption is that financial spread betting is tax free here in the UK at least under the current tax laws. The crux of the issue seems to be the nature of your trades, as summarised here taken from the Spread betting forex tax free.
HMRC will try to tax betting if it forms part of another trade. To be taxable, the spread-betting wins must come not merely from an opportunity presented by a trade, they must arise from the carrying on of that trade.
This could happen if, spread betting forex tax free example, you were a professional stockbroker or share trader, in which case your spread-betting profits would probably be taxable.
Effectively, if spread betting is your main source of income, then this is considered trading and you will be taxed on these profits. Is financial spread betting be it derivatives, forex trading, whatever gambling hence not subject to taxtrading hence subject to income tax or investing hence subject to CGT?
Spread betting is essentially day trading with one important difference that no assets exchange hands — still if you get a market direction right you make money! They spread betting forex tax free not taxable on the profits, nor do they receive relief for their spread betting forex tax free. Whether or not a particular spread bet is taxable will depend on the terms of the contract and the economic substance of what is done.
But if what you are doing day in day out is spread betting, then it is a trade…. But for the lucky few who consistently make profits, the situation spread betting forex tax free more complex and for those without a second income I think HMRC might argue that it was no longer gambling.
Or if you can convince HMRC that you do this only occassionally ie I had a good three months winning run and that you have now stopped, all these things put up obstacles. To put it short, whilst the concept is sold as tax free I think it is dangerous to assume that it is a carte-blanche to do as much as you want and remain untouched. The big problem for HMRC is that if they start to treat gambling as a trade, they will be hit with loss claims from the losers, and as there are more losers than winners it would become a very expensive exercise.
Really fair would be every single person paying exactly the same tax regardless of what they earn but of course that would not be considered fair.
It all started with the child allowance thingy. As soon as the prime minister claimed it to be fair it gave ammunition to the opponents. Now the latest thing is the spending review. When the young are paying for higher education why am I getting an increased tax allowance.
This is how our tax system works. In any case generally speaking the few who pay the highest taxes do tend to benefit from tax reliefs and reductions. Attack them for being rich and the risk is they may take their wealth elsewhere. Brilliant article back page of Telegraph Your Money section.
Describes tax in terms of beer spend. So the nine men surrounded the tenth man and beat him up. And that, the article concludes, is how our tax system works.
The few who pay the highest taxes do tend to benefit from tax reliefs and reductions. For those who understand, no explanation is needed. For those who do not understand, spread betting forex tax free explanation is possible. Are you sure your spread bets are tax free? The crux of the issue seems to be the nature of your trades, as summarised here taken from the Times HMRC will try to tax betting if it forms part of another trade.
They decide to split the bill in a similar way to tax bill.
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