Originally posted by MarillionFan
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I have registerd with this forum in order to ask you a quick question about your post in the thread "HMRC Tax Rules - Day Trading?" from 20-21st April 2014.
I am sorry for going off Topic for this thread, but I could not find a way to contact you directly, and thought the easiest way of reaching you is by posting on your most recent thread post.
I just wanted to double check with you that as a day Trader you say that you get taxed as income tax and not capital gains tax. I wanted to ask whether the income tax you pay at the end of the year is on the NET gains made OR on GROSS gains that you made? (to confirm, by NET gains I mean if you made 2 trades resulting in £400 loss and a £1000 gain, you would have a NET gain of £600, and so would pay income tax on the £600 gained. And by GROSS gains, I mean if you made 2 trades resulting in £400 loss and a £1000 gain, you would have a GROSS gain of £1000, and so would pay income tax on the £1000 gained.)
The other question is about whether you deduct the commission and the spread cost for trading from the gains made, in order to reduce the amount of tax baing payed? So for example, I plan to day trade with the Swiss Dukaskopy Broker, and they have a variable spread for the EUR/USD FOREX pair, and additionaly volume commision fees of say £30 per Million traded. At the end of the financial year, do you subtract the comission fees and/or the spread for the instruments that you trade from the gains made, and thus reduce the amount of income tax that you have to pay?
Best regards,
Alex
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