Thanks for your reply F interesting stuff.
You say
"I am absolutely sure I am not the only FX spreadbetter between 2006 and 2012 who's been taxed - under the definition of a "professional gambler" ... well this is an opportunity to find out, what a bummer if you are
.
"Having 30 punts a year is different to 10+ trades a day"... why? Its still the same thing
Is 9 trades a day Ok what about 7 or 5 or 2
what is the rule? There is no rule. Gambling is gambling is gambling, its tax free to the punter because the SB pays the tax. Heres what UK case law has to say about "the professional gambler"
http://www.hmrc.gov.uk/manuals/bimmanual/bim22017.htm "There is no tax on a habit."
I take it the Inland Revenue looked at what you do and said you must pay us 'x' and you paid.
Why? I think they tried it on with you and you caved in. If they took you to court there would be case law in the UK and we wouldnt be having this discussion it WOULD be black and white. Just my opinion please tell me if I'm wrong.
So if you pay tax on your winnings do you offset your gambling losses against your tax bill?
arty: Imagine the uproar if that were possible.
I am not privy to your private tax affairs but there are 'certain types' of spread betting that have been deemed taxable, here are 3.
1. Ones in which the outcome is > 1.
http://www.hmrc.gov.uk/manuals/bimmanual/BIM22018.htm
This is why betting companies pay tax, because they offer odds to punters with <1 return, you add up all the odds in a horse race and bet on every horse and you will lose money. If you structure a spread bet so there is no chance of a loss
thats not gambling(its a dead cert.) and you may be asked to pay tax.
2. Its a commercial transaction wrapped up to look like a spread bet in order to avoid tax.
http://www.hmrc.gov.uk/manuals/bimmanual/BIM56900.htm.
3. If you have a 'Bot' which takes advantage of the emotional exuberance of punters (technically arbitrage).
https://www.accountancylive.com/tax-and-gambling-man (under 'professional punters') again a dead cert, no risk.
Given the examples above I concede it isnt black and white, but if your spread betting on FTSE, Dow, Forex 100 times a day, it is!
http://www.hmrc.gov.uk/manuals/cgmanual/cg56105.htm
If you make £300k a year and you keep some of it in a bank, you will accrue interest which IS taxable. If you have a second home which you rent out or sell that is taxable. So a person such as yourself would have to pay tax anyway.
The Inland Revenue are nice people :innocent: but they do like to chance their arm a little in order to extract money from citizens. (For the benefit of the country of course, lovely people love 'em all
).
To sum up, if you pay tax on £300k PA you might want to think about getting a decent accountant, because they sure as hell wont charge you £100k+ to cut your tax bill. You can buy me a drink later. :cheers: