Share Dealing Discussion Area

jools2001_2

Cheers Tradetime for the advice, i suppose realistically it would more than likely be no more than 1 or 2 times a week.

Was hoping someone here does a similar sort of thing as i intend to do,so i could see if there was any major tax issues and if it was worth doing if that was the case?

Thanks again for reply and advice :beer:

cheerfulcat

Hi, jools,

I looked into this when I first started relying on investment for an income. The situation then ( 6 years ago ) was that HMRC would rather you didn't have the status of " professional " trader/investor as you'd be able to offset all sorts of expenses - it was actually very difficult to get them to accept you as a professional trader. I expect that hasn't changed.

If you are going to do a lot of trading then bear in mind that you need to keep scrupulous records - even if you don't make profits greater than the annual exempt amount, if the total proceeds in any one year are greater than 4 times the annual exempt amount then you may need to report all of your trades to the taxman.

jools2001_2

Cheers Cheerful Cat,

Think i will have to tread carefully and not trade anymore than maybe once or twice a week ( if that )

Wish the govt tax web site would give people a bit more information on the tax rules on this,and not just the CGT Tax as the site shows presently.

because i started late last year im gonna be well within my limit for this tax year,but will have to be more careful for the next tax year coming up, and maybe open an ISA sharedealing account instead?

Cheers again

Jools :beer:

sabretoothtigger

If you are actually that successful it would be worth paying the fine and a bottle of champagne, its pretty dam unlikely in this market unless you are making big bets, big risks and get lucky early then stop trading.

You should read that naked trader book, he seems to be focused on consistency and might even discuss the tax side since he has done well

simpywimpy

I read this week in investors chronicle that there is talk of the merger between hbos and lloyds being reversed to stop lloyds going under completely.

Is this likely?

6022tivo

They just need to hurry up and close all the now redundant Halifax branches...

The_MoneySavingKid

sabretoothtigger wrote: »

If you are actually that successful it would be worth paying the fine and a bottle of champagne, its pretty dam unlikely in this market unless you are making big bets, big risks and get lucky early then stop trading.

You should read that naked trader book, he seems to be focused on consistency and might even discuss the tax side since he has done well

He mentions it's best to trade in a self -select ISA,which shielded him from a vast amount of Capital Gains Tax from having to be paid,but then he says he still has to pay it when he reaches that £9,200 limit.(Now been upped to £9,600 for 2008-2009 year...)
This may help:
http://www.hmrc.gov.uk/cgt/shares/calc-cgt-08-09.htm

Biggles

It's best to do it within an ISA anyway (unless you're using spread betting, which is tax-free in any event).

However, the last time I saw this matter discussed by people who seemed to know what they were talking about, there were no cases - ever - of the Revenue having classified anyone who was trading on his own account as 'earned income'. You will pay CGT only and, as long as you are upfront with that in your tax returns, the Revenue won't be interested further.

tradetime

The_MoneySavingKid wrote: »

He mentions it's best to trade in a self -select ISA,which shielded him from a vast amount of Capital Gains Tax from having to be paid,but then he says he still has to pay it when he reaches that £9,200 limit.(Now been upped to £9,600 for 2008-2009 year...)
This may help:
http://www.hmrc.gov.uk/cgt/shares/calc-cgt-08-09.htm

Haven't read that book so going out on a limb here, but if he is trading through an ISA, I can't imagine why he would be paying tax above the capital gains threshold, the whole point (maybe not the whole point) is to shield you from Capital gains tax.
Beyond that it depends what your objective is, if it is to derive income from short term trading the ISA's are dross, they are over priced, narrow ranged, poor featured, but as I say, big part of that is what you want to achieve, if you are going to buy stocks and swing them for days or weeks, whilst they are not the cheapest you make that back in tax. The OP sounds like he wants t try and make income, that's difficult under any circumstance, better to start outside an ISA and move it in if it works.

Biggles

tradetime wrote: »

Beyond that it depends what your objective is, if it is to derive income from short term trading the ISA's are dross, they are over priced, narrow ranged, poor featured, but as I say, big part of that is what you want to achieve, if you are going to buy stocks and swing them for days or weeks, whilst they are not the cheapest you make that back in tax.

That's not true for self-select ISAs: with most brokers, their self-select ISAs operate under the same terms and charges as their normal dealing accounts. And the bid-offer spread, obviously, is the same anyhow.