Soloquan
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All spreadbetting profits (should you have any) in the UK are tax free. No CGT at all.
I'm sure you know this already but just making sure... spreadbetting and trading is a hard game to play. You should only use money you can afford to lose and that generally means trading with your own money and not friends and family. Spreadbetting can be pretty stressful without the added stress of losing Granny's pension.
Unless of course you've demo traded for a long time and you know what you're doing which I'm sure you do
I'm sure you know this already but just making sure... spreadbetting and trading is a hard game to play. You should only use money you can afford to lose and that generally means trading with your own money and not friends and family. Spreadbetting can be pretty stressful without the added stress of losing Granny's pension.
Unless of course you've demo traded for a long time and you know what you're doing which I'm sure you do
Yep I know its hard, but I was thinking of tax implications and the structure of a small fund, if you traded with power of attorney would the fund be small enough to avoid CGT on family funds.
To big and you have to go be a registered in someway, but small could be just right to avoid taxes if spreadbetting and the correct structure is setup.
But who can clarify such things? a tax accountant?
To big and you have to go be a registered in someway, but small could be just right to avoid taxes if spreadbetting and the correct structure is setup.
But who can clarify such things? a tax accountant?
Losing your (and your families) money will always be tax free, and that's what will happen if you attempt this. You might as well bet on horses with your money. Give them their money back before you get yourself into a massive mess.
Soloquan
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Why would you declare to IR that it is a fund? You'd put the money into a bank account you'd set up and deposit the funds direct to a spreadbet account surely.
ALL PROFITS FROM SPREADBETTING ARE TAX FREE.
But I hasten to add this is not a good idea. Seriously I wouldn't advocate trading with other peoples money at all. Like Pboyles said you'd be better off betting on the horses than gambling (and that's what you'd be doing) in the markets with your friends and family's hard earned money.
ALL PROFITS FROM SPREADBETTING ARE TAX FREE.
But I hasten to add this is not a good idea. Seriously I wouldn't advocate trading with other peoples money at all. Like Pboyles said you'd be better off betting on the horses than gambling (and that's what you'd be doing) in the markets with your friends and family's hard earned money.
Its really theory rather than practice, I know the dangers for sure I traded for a 3 years with my own account then got into an investment fund in europe, now I am back in the UK, so I know better than to jump in with others money.
But this is a forum and I am expressing an idea, their is one spreadbetting firm that the spreads are now tight enough that if you are a frequent trader its now a better option than tax avoidance schemes.
You would have to have 1 bank account and that money will be spotted by any bank passing through, so you still have to have an audit trail or you will get problems somewhere along the line.
Keeping it simple whats a simple structure or the best place to go for advice?
But this is a forum and I am expressing an idea, their is one spreadbetting firm that the spreads are now tight enough that if you are a frequent trader its now a better option than tax avoidance schemes.
You would have to have 1 bank account and that money will be spotted by any bank passing through, so you still have to have an audit trail or you will get problems somewhere along the line.
Keeping it simple whats a simple structure or the best place to go for advice?
Soloquan
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How is being a frequent trader better than a tax avoidance scheme (whether it's TECHNICALLY legal or not). Just means you have a faster way of blowing your money. Anything over 10k you shouldn't be spreadbetting with anyway... imho
HM Revenue & Customs: Capital Gains Tax
The rest is up to you
BeginnerJoe
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Not if he knows what he's doing. 10k a pip could be quite interesting. Could become a millionaire in a day. It will save all the hassle of tax avoidance.
NVP
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BeginnerJoe
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Yes, some of them go to casino with family and friend and call it an investment expedition.
jungerns
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Any further words would be totally Superfluous.......
Well done.....
I love Sundays !!
Hoggums
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You are running a fund, not SB'ing as an individual. Therefore the tax rules for individuals do not apply and you would be liable for tax on all profits. I'm pretty sure if you told that to any SB they would not take your business. Any SB profits made by a company are subject to tax and I'm pretty sure the same rules would apply to a fund (which is in effect a business).
Also you are not allowed to trade other peoples money if you are not FSA registered. It is illegal and there's a certain individual who used to frequent this site who got his knuckles wrapped by the FSA for setting up a fund.
I would suggest you get your family/friends to gift you the money - then you can trade it as yourself tax free on the promise you'll gift back the money to them + profits at a later date. Obviously you can't set up any formal agreement to pay the money back otherwise it is no longer a gift and you might be liable for tax for the benefit you've gained in having the money from them.
Whether your friends would go for that - well I guess if they're stupid enough...
Also you are not allowed to trade other peoples money if you are not FSA registered. It is illegal and there's a certain individual who used to frequent this site who got his knuckles wrapped by the FSA for setting up a fund.
I would suggest you get your family/friends to gift you the money - then you can trade it as yourself tax free on the promise you'll gift back the money to them + profits at a later date. Obviously you can't set up any formal agreement to pay the money back otherwise it is no longer a gift and you might be liable for tax for the benefit you've gained in having the money from them.
Whether your friends would go for that - well I guess if they're stupid enough...
Lee Shepherd
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For the benefit of the OP and other readers.
Firstly pay close attention to Hoggums post above, he is absolutely right in this degree and one could find themselves in trouble (or at least a huge tax bill if your lucky enough to make profit) should they not adhere to the law.
However:
Don't lose site of wording, that's crucial here as with any law or/and terminology. If in any doubt whatsoever see a lawyer who knows contract law and will point you in the right direction. DO NOT TAKE THIS POST AS ANY KIND OF ADVICE. Its just somewhere to start from.
Firstly, there should be no mention of trading - YOU ARE NOT - you are gambling, straight forward and simple. It works exactly the same as if you give me £10 or £1,000 to go to the bookies and place money on a horse, if it wins I collect and give to you, if it loses, tough.
Also, lose the word - PROFIT. You are not making profits if you win, see above, you are winning by gambling, not buying or selling a product or service - remember you are not trading - with your money or anyone else's.
Lose the word FUND and anything else related to this wording, you are not. You are also not providing a service or charging for a service. You are simply taking someone's money and gambling with it with their permission. If anything you are more of a consortium. For this you can have legally binding contracts drawn up with or without obligations.
If you stick to the above, then you are not a business nor a company. You are not guaranteeing returns or profits but simply gambling someone's money on their say so to hopefully win.
If on the other hand you wish to become a managed fund then you have a very long way to go, to be blunt you wouldn't be asking these questions on a bulletin board but would instead be sat in front of someone professional who's charging you many hundreds per hour.
Regards,
Lee Shepherd
Firstly pay close attention to Hoggums post above, he is absolutely right in this degree and one could find themselves in trouble (or at least a huge tax bill if your lucky enough to make profit) should they not adhere to the law.
However:
Don't lose site of wording, that's crucial here as with any law or/and terminology. If in any doubt whatsoever see a lawyer who knows contract law and will point you in the right direction. DO NOT TAKE THIS POST AS ANY KIND OF ADVICE. Its just somewhere to start from.
Firstly, there should be no mention of trading - YOU ARE NOT - you are gambling, straight forward and simple. It works exactly the same as if you give me £10 or £1,000 to go to the bookies and place money on a horse, if it wins I collect and give to you, if it loses, tough.
Also, lose the word - PROFIT. You are not making profits if you win, see above, you are winning by gambling, not buying or selling a product or service - remember you are not trading - with your money or anyone else's.
Lose the word FUND and anything else related to this wording, you are not. You are also not providing a service or charging for a service. You are simply taking someone's money and gambling with it with their permission. If anything you are more of a consortium. For this you can have legally binding contracts drawn up with or without obligations.
If you stick to the above, then you are not a business nor a company. You are not guaranteeing returns or profits but simply gambling someone's money on their say so to hopefully win.
If on the other hand you wish to become a managed fund then you have a very long way to go, to be blunt you wouldn't be asking these questions on a bulletin board but would instead be sat in front of someone professional who's charging you many hundreds per hour.
Regards,
Lee Shepherd
MORRIS2001
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If you pool the money into a single legal entity that is not an individual then it is tax liable.
If you pool the money into a single individual you will have tax issues distributing profits. Plus, the obvious credit risk ramifications.
You could block trade accross multiple individual accounts but you will require POA and if charging a fee, or recieving a payment then you will be conducting a regulated activity.
It is a messy area with enormous tax and personal pit falls.
If you pool the money into a single individual you will have tax issues distributing profits. Plus, the obvious credit risk ramifications.
You could block trade accross multiple individual accounts but you will require POA and if charging a fee, or recieving a payment then you will be conducting a regulated activity.
It is a messy area with enormous tax and personal pit falls.
Remember that you may be able to set something up with a nod and a wink about gifts or loans but when people lose their money they'll be all too willing to report you to the authorities. There was a saga here where people contributed to an unregulated 'fund' and nobody said a word. As soon as they realised the money had been lost they were all over the FSA and it resulted in the guy being declared bankrupt. Youre playing with fire here.
