TAX ON FOREX [Do you pay tax on forex trading, tax on spreadbetting, UK forex tax, CFD tax, CGT tax]
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- Опубликовано: 26 июн 2024
- Do you pay tax on forex? How much tax do you pay on forex? And specifically on your personal forex trading account. It's a grey area and forex trading tax is a bit of a complex one. In this video I try and break down my own personal experience and opinions surrounding tax on forex but before any financial decision you should always consult a financial professional/accountant. I am not a finance professional in any capacity and my videos are for entertainment purposes only.
Video Order
00:00 - 00:50 - Intro
00:50 - 01:40 - What's being covered
01:40 - 02:10 - Do you pay tax on Forex?
02:10 - 02:25 - Main trading methods
02:25 - 03:24 - Spreadbetting overview
03:24 - 04:21 - CFD overall
04:21 - 08:25 - Grey Areas - Tax considerations
08:25 - 09:08 - Tax categories
09:08 - 09:31 - Speculative category
09:31 - 10:15 - Trader status vs Private Investor status
10:15 - 11:55 - Ways the government can assess you
11:55 - 15:15 - Spread betting tax summary
15:15 - 16:45 - CFD tax summary
16:45 - 17:11 - Capital Gains Tax on CFD
17:17 - 17:54 - CFD Tax example
17:54 - 20:25 - Summary
#taxonforex #forextax #forex #forextrading #forextaxuk #uktax #cfdtax
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This is the most comprehensively informative video on UK trading taxation I've seen! Certainly gives you a good idea of which direction to go before seeking advice from an accountant, which obviously isn't free. Thanks for sharing your knowledge.
Appreciate this Jake - glad you got something from it 👊🏻👊🏻
Very informative, packed with soo much info, going to have to rewatch a few times to grasp everything.
Thanks Nick 🙏 yeah took a while to put this one together!
Great video! Thanks for taking the time to explain tax in depth
Thanks Owen - glad you got something from it!
Fantastic discussion surrounding the whole trading status vs investment debate.
I haven’t seen other commenters even make this distinction.
Absolutely!
Absolutely brilliant Matt helped me a lot
Glad you got something from it 🙌
You really did explain this so well! Ive spent over 10 hours trying to research this and so much misleading stuff! I apologise for my last comment about you not being specific enough! VERY GOOD WORK HERE THE BEST YET!!!
No worries! I'm glad you found it useful 🙌
Many thanks. Great info 👊🏼👌🏼
Glad you got value 👊🏻🙏
Excellent video, thank you!
Thanks Kai - glad you enjoyed it 🙏
Amazing video, good job :)
Thank you 🙏
Excellent, thanks Matt
Thanks Michael 🙏🙏
Bro I was looking for you. Thanks
Cheers man - glad you got something from it! 🙏
awesome video on tax!!!! nice one!!!
Glad you enjoyed it!
Great information! Thanks for sharing! Looking forward to more content! New subscriber here!
Thank you! 🙏 glad you're enjoying it!
Wow. the best video I have seen on this topic full stop. I have a question Matt and of course this isn't personal official advice but I spread bet along side having a normal job and with spread bet I make about 50k a year and my normal job is around 100k. Do I need to declare this to HMRC because my understanding is spread betting doesn't need to be declared but as the amount is getting substantial it's becoming a grey area for me!
Great video matt
Thanks a lot - glad you enjoyed it 🙏
I bet you are good accountant. Explained so well.
Glad you got some value from the video! 🙏👊🏻
He speaks as fast as my tf the 1m tf.. Naturally with fluidity omg! Champion
🤣🤣
0.75x
Super helpful 👍🏻👍🏻
Glad to hear it 👊🏻
Very knowledgeable thanks for sharing
Glad you got some value from it!
Great explanation.
Thank you 👊🏻
Hi Matt, this is very informative video. In my situation, I started earned big profits consistentaly in forex trading for the month of May and I've exceeded my daily corporate income. I was learning forex for many years with demo, EA. and with real money too. My take away from this video is set to aside 25% of my trading profits for future tax expenses and in the meantime use 75% of my profits as personal needs. In that way, I can worry about HMRC later and seeking professional advise later so going back to the charts and keep that health profits roll in. I am forex scalper and might be classified as speculative trader according to Matt's video.
Such an informative video Matt - thank you! Though I doubt you'd recommend individual accountants in the UK, do you know of any websites, registers etc of accountants who have experience working with traders? I don't want to go to one who doesn't really know or have experience of the tax ins and outs of this unique industry and I end up with advice which means I pay more than I need to. Thanks again mate.
Thank you for the video. Are taxes for trading futures any different? could you if possible cover this in a video, please :)
Martin Lewis of Forex right here 👍🤑
🤣
Great video Matt. Is this the same for futures daytrading trading too?
Thanks Joe 🙏 Yeah, what you're trading is less relevant, it's more about how you trade it
. Really useful appreciate the effort mate. We'll done. This needs to be made more aware for UK bitcoin traders who click away 30 trades a week from their phones and end up with a tax bill.
Glad you got something from it man 🙏
What a great video! So basically if you are just starting off with CFD's forex pairs day trading and happen to make a profit in you first year, you would put it down as capital gains and keep doing that annually until the HMRC otherwise notify you with a certain trader status.
Glad you enjoyed it 👊🏻 Yep - registering for self assessment to declare CGT on CFD profits is certainly a strong option.
finally , thank you.!
🙏
I have trudged the internet and you tube for the last 5 to 6 years worrying about paying tax on spread betting . And you have confirmed every thing I have read. Thank you .
First: why you are so underrated?
Second: you give tremendous amounts of information for free on youtube as well as instagram. Legit, quality info, without expecting anything in return, without making stupid paid online courses filled with shit. Keep up the good work!
Really appreciate this - thank you 🙏. I'm glad you're getting some value across here and insta - always just let me know if there's anything you'd like to see in the future too
I think you may have answered your own question - the unfortunate truth is that more people are drawn to the IG, get rich quick, turn £500 into £500,000 type videos. The information provided here is far too sensible and grounded for those types.
Hi Matt, loving this series on tax as it was just what I have been looking into and especially the UK and for ftmo thanks. Is it possible to message you privately?
Thanks Andrew - really appreciate the support 🙏 sure, people tend to grab on Instagram (@matttomillion) or email - matttomillion@gmail.com
Hi mat i have watched loads of videos about tax on you tube yours is the best by far. But can you answer a question for me I have just opened an account I was told by the broke to be expected from paying capital gains account I would have to use a spread account because they use stakes instead of lots its tax free so I went for it but the spreads aren’t good. Could I still use there raw account which little to no spreads and still be excepted from tax ?
As long as I don’t have trader status? Please
Hi, I have question on Income tax for a self-employed sole trader/share day trader, is there any difference on matching rule calculation with the CGT calculation? ie: B&B rules, 30days rule, last in first out etc. Thanks for ur help!
Thanks for the great content, will be rewatching to take it all in! One question though, if you trade an Ftmo account and pay tax on it can still trade a personal account and not pay tax?
Thanks Guy 🙏 In theory, yes as FTMO is seen as a service and personal trading is with your own capital but again depending on how much of your income comes from trading related income as a whole/all the other stuff they assess by, will determine what your status would be. The simplest set up to do both would be through an Ltd for your personal account and FTMO (just my opinon though!)
This is the only video that makes some kind of sense. Im still struggling to understand. If i am just copy paste trading a professional, but make constitant profits where would i fall. Do i just go self employed and do i only pay tax on the money i actually take out of my account of everything thats in the account.
Hi Matt! Great and very informative video, could you possibly do one about whether there is a tax difference between trading on an account that you withdraw your funds straight to GBP and one that you withdraw in BTC? Just wanted to know if it’s only selling the Bitcoin that i’d have to pay tax on if withdrawing in BTC. Cheers!!
Yeah BTC is a bit of a grey one atm. But hoping to do a more indepth video on it in time to come!
@@MatttoMillion nice one cheers matt. Was just curious as some forex brokers only allow you to withdraw in BTC….
nice vid
Thank you 🙏
Nice
🙏
Great video, thank you. Just one question.
I work a full time job but was also wanting to get funded by ftmo or funding talent. Would i have to pay tax on the profits from them because i’m not sure it would go down as spread betting.
Thanks Steven - I've got a couple of videos specific to FTMO which explain that in a bit more depth. Head over to them and let me know if you have any questions!
Fantastic video thanks for the info, do you have any videos regarding reinvesting profits from CFD trading into say property asset management.
I’m under the assumption that you pay capital gains only when you sell said property.. and you pay tax on any passive income from renting it out etc?
Liked and subscribe again many thanks for the info and effort of putting this video out ✌️
Glad you enjoyed it 👊🏻 yeah I've got some updated videos coming out later this year with the new regs!
Appreciate you 🙏🏻
So my buddy been telling me to look into forex taxes and type of stuff - recently crossed the 5 figures barrier, would I be liable to tax ?
This is all on my personal trading accounting and I work part-time as a bartender
Any advise would be helpful. Thank you 🙏🏾
So what if your trade prop and mirror those trades with a spread bet account?
Is binary options like pocket option spread betting if scalping?
I'm just about to start trading forex and Im really confused as to what would be more beneficial for me, spreadbetting or CFDs. I work full time and don't intend to leave my job no matter how good I do with trading, but I'm concerned if I earn more than my salary, if HMRC one day demand me to pay tax lol. Is there anyone I could ask who could tell me if I'd be liable to pay tax if I earn more than my salary, and at what profit level would HMRC consider me to start paying tax?
Hey Matt I sent you an email but thought I’d comment here too. Any tips on getting a business bank account for a llc which does forex trading or prop trading. So far it’s been a nightmare to find a bank that accepts trading. Please help a guy out
So I’ve just done a funded challenge, how soon after do you think I should do this?
Hello sir. I have a question. What if u r using a broker that doesn't accept US residents and u r one of them but u r using it somehow!. When it comes to taxes is that can be a problem paying them?. Thanks
What if I’m trading on binary through broker , should I pay tax of my earned profit or not to withdraw the amount ?
What about prop firms?
Question. I am on benefits for disability at the moment. If I open a trading account and start trading at a low level below 5K but I don’t withdraw any money from my trading account. Will I still be liable to pay tax and also would HMRC or DWP or Universal Credit Job Centre be contacted because I have provided the trading company with my Name and Ni Number and bank account. ?
So I’m just passed a funded challenge, when should I start paying tax?
Still confused lol , I trade Futures NQ do I register has self employed ?
Hi, quick question. Lets say im a full time trader & for this example If im making say £20k a year on my personal trading acc - but by the time I submit my yearly earnings to my account - lets say ive spent that £20k that I made, what happens regarding tax as ive already spent all the profits I made?
Great videos keep up the good work.
Hey Nick, Thanks for the support - appreciate it 🙏 of course I can't advise on this as I'm not a finance professional, you'd have to get that confirmed by an accountant.
From my experience, you owe tax on any profits. So if that £20k was spent on personal stuff, you'd owe tax on it regardless. Easiest way to avoid being caught out is to always put your tax aside as you earn it so you don't end up in a position of owing tax you can't afford to pay and accruing charges and fees etc. in the process.
Think of it in a normal job, you are taxed at source so the money you're given is net of tax and you can spend as much as you like wherever you like, an employer doesn't give you your gross pay and leave you to pay the taxes you need to pay.
So in essence I treat the trading profits the same. I 'tax myself at source' sort of thing, if that makes sense so I know how much I can spend without worrying about what I owe.
@@MatttoMillion Yes, makes perfect sense thanks. I was thinking along the same lines as yourself but had been given other information too so wanted to confirm my thoughts. Thanks again & keep up the good work :)
Can you recommend a Tax Advisor/Accountant who has considerable knowledge of FX trading and is aware of what to expect ?
Hey Sabedul, always a bit apprehensive on any recommendations for obvious reasons. I am slightly unique in the sense that I do a lot of the accounts preparation myself, so my requirements are different. I know that accountantsunlocked have an arm dedicated to forex/day trading so it may be worth doing a consultation with them to see but I couldn't vouch for them personally.
Hi Matt. If you don't invoice your payouts i.e. you don't withdraw any profits from the prop firm you are trading within a given tax/financial year do you still have to declare the profits made even though they weren't 'realised'?
Thanks in advance.
No - not if it's not been invoiced or received.
@@MatttoMillion Thanks Matt. Does the same apply to your own personal trading account with your broker where you don't withdraw your profits made? Thanks again
@@MatttoMillion ??
@@thomasxjunior6956 Sorry did u ever find an answer to this? Im wondering the same :D
Are you liable for VAT if you hit the threshold or are you exempt?
You don't pay VAT as a deduction on your profits, you'd charge it and pay back what you don't use of it. You will always need to register for VAT if you hit the £85k threshold
If I’m trading forex with a broker which one applies to me, personal or limited company? Thank you
Either! It's up to you how you would like to structure your affairs/accounting practice
How would someone know if they have been given trader status?
It comes from an HMRC assessment if they feel there's any obvious avoidance of tax. So best to work with your accountant on how you would be determined as you go through your trading years. They're used to the tribunals and whens a good to time to adjust your tax structure
Are you able to suggest some tax accountants?
accountantsunlocked for the UK
hey matt, quick question, say you NEVER withdraw your forex profits from your broker and it just stays and builds up in your trading account, will you still be taxed?
Nop
@@singhn4v Until you withdraw it
Yes you will get tax on any money u make regardless if u withdraw or not and the brokers report all profits u make to your countries revenue
Only becomes taxable once withdrawn :)
Hi Matt can you help clarify as there is diff opinion from people on this question. I use a broker and trade forex pairs and some commodities. If i do not withdraw from the trading account by keep it in to compoung do i still pay the tax or only when i withdraw it. Thanks this is not clear to me.
Hey did u ever get an answer on this? I'm in the same boat
@@TheMrHost no unfortunately not. Need to Google it some more let me know if u find out bud.
@@bananna7465 Yeah, I been searching online and keep seeing mixed answers. It seems like something only a professional tax advisor could provide a definite answer for but Il let you know if I find anything.
What would happen if you are a full time trader and make £50,000 profit in a cfd account and make another £50,000 in a spread betting account. Is the spread betting account still tax free?
All depends on your personal situation, your primary source of income and style of trading, so I couldn't really comment on the combo, best to give the HMRC/accountant a ring on that one
@@MatttoMillion My main source of income would be the £51,000 cfd account. And secondary income would be the spread betting account with £49,000 👌😁😉🤣.
How are you so knowledgeable?
😂I wouldn't go that far! But thank you 🙏
How do you find an accountant which specialise in managing forex accounts in the uk?
There are you a few out there you can find online or best by word of mouth. I'll be making a video this year to give a recommendation
@@MatttoMillion looking forward to this thanks subscribed to your channel yesterday happy new year btw
All your contents are great and really appreciate your time on making this video. However, I would really suggest you to speak slowly because many time I cant understand you very well and I am sure there many of your audience who are not from UK facing same problem. This makes the video not so much engaging and interesting and on the other hand you lose your viewers and the core message will not be delivered. Speaking slowler helps to digest what you are saying. Thanks.
How would they know if I make 14k? If I'm not with a prop firm and by myself why would I declare?
Usually your broker will report to the HMRC as you're linkedin via ID and NI number + reporting is the law 🤣
@@MatttoMillion it's law to snitch? I mean report? I didn't know that. So if u ear over the no tax threshold they're obliged to report?
@@TheSeanxy yeah, and unless you're making much, much more, its really not worth trying to get away with idea. The risk/reward's terrible.
anyone learning to trade should def not hold trades, trade on 1 min, find the trend direction, get in out fast, rinse, repeat...anyway, my advice :)
Rubbish.
This is what I do it works
Bro can you talk slowly if you don’t mind please and thanks 🙏
Yep, definitely tried to improve that with the more recent videos
@@MatttoMillion good job 👏