do you have other employment, suggesting you dont trade purely to make a living? If you fall under this bracket any day trading profits are free from income tax, business tax, and capital gains tax. This type of operation should be carried out only with the help of a tax professional, and it may be best to confirm with at least 2 tax professionals to make sure you are making the right decisions. You will need to carefully consider where your activities fit into the categories above. If hmrc believes your motivation for trading is to generate profits, this will impact on whether they consider your activity as trading for the purposes of taxation.
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That means when it comes to filing your tax returns you need a detailed account of all your trading activity. This number should be used to file taxes under either section 1256 or section 988. This example is no different to someone who likes to undertake equity share trading as a frequent hobby. There are also numerous tax advisors that specialise in tax for day traders. Consider that many currency, options, and stock speculators only hold onto assets for a short period of time, this means for both investors and traders the tax rate could be 40 (assuming they were both higher rate taxpayers). This page is not trying to give you tax advice.