M
malaguti
Its amazing how many "tax experts" we have on T2W
and forex experts ..."retail forex", my bad
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Its amazing how many "tax experts" we have on T2W
What at District level and within last 10 years ???
If so - you are either covering or not mentioning their "black arts " ;-))
Regards
F
Much higher than district level but not within the last ten years.
Nothing much has changed though - the evil wizards are still out to dun everyone they can and pull every sort of trick to do them out out of their money. That's what you believe, of course, such a pity it's so far from the truth
Hi Forexmospherian,
Can you help me with the following so I understand what it is you are saying:
I have a friend who by all accounts claims the following: (although he is probably lying)
He has won in excess of around £30 to £80k per year for over 6 years spread betting without having any other form of employment or work including self employment. Would he be liable for tax?
He has also in recent years been self employed earning around £15k pa) and winning of a smaller amount of around £20k per year gambling on the markets. Would he be liable for tax here as well?
He says he has even contacted HMRC in the past and they don't want any of his winnings, just tax payable on his earnings only.
Many thanks or your reply.
The ante has been upped on tax avoidance (previously treated as an ok , if morally dubious, way of reducing tax burden) which is now pursued and challenged much more vigorously. Nonetheless, HMRC are still bound by the law and if there is a loophole that people can legitimately exploit then the only recourse is to change the law to close that loophole. They can't (and don't) just say "Dammit, we didn't really mean that anyone could do that so we'll just ignore the law and grab the tax back".
Hi Anon
I can only help you from how I understand it and of course the advise I received was really only applicable to my own Tax situation in relation to spread betting and so maybe different for other traders etc.
I am no Tax expert myself - but had spent considerable monies ( over £1200 just over 5 yrs ago) dealing with my own case - which I will say was complex.
From what I understand as of today - your friend who has employment and already paying income tax has no worries or concerns about his present profit being taxed.
They are tax free whether £100 per annum of even £100k per annum - as long as his employment as no connection with his trading activities.
OK.
Now the past. When he was earning larger amount of monies per year - when he had no employment - then although he may have been advised by his broker of even local tax office his profits were tax free - If today the HMRC was to find out about this case - and had reason to delve back into his tax affairs - they may then want to challenge him on that particular period - even though today he is now paying income tax through his other employment.
I think it is unlikely they would find out or even what to look at the case - but if he fall foul with them in the next few years - they can go back up to I think 6 years into his tax arrears.
Its all then down to negotiation and how much money he wants to spend with solicitors etc to get him off any penalties or charges - ie its worth spending £2-3k to save £10k - but not worth spending £3k to get it reduced by only £2k.
It all helps if he has it in writing from his local tax office that his spreadbetting was tax free at that time - and also as long as he was not claiming benefits etc when he was not employed - but earning from spread betting etc.
If there is any "weakness" in his past case - then the might of the HMRC will want to take him to task. Threatening bankruptcy to get out of a larger tax bill will be of no concern to the HMRC - their job ie to get money into their coffers and although they are going to have more opportunities with people earning large amounts of money - they can still intimidate and take advantage of their unique position with anyone who they think might in some way owe the some "back or undeclared" tax.
80%+ of the time - they win - but that does mean 20% of the time they don't ;-)
That's how I see it from what I have gone through myself - but to reiterate - it might be different for other people etc
Regards
F
Hi Anon
Also - people who contact the local tax office and ask for clarification - will of course be recorded and logged.
Its a bit like what NVP said - ie - dont ask an hairdresser if you need an haircut
For advice to be given out they will need to take your details. If you ask for clarification of something you are not already doing - and basically the answer comes back spread betting "winnings" are tax free - under these circumstances etc etc - the person will only want to hear what the good parts and not any downside. Therefore if he states you I have a job and pay income tax and NI etc etc - and then claims I was told its tax free by the Local tax office on this date etc - a record of the conversation can always then be looked at in the future.
If circumstances change and besides spread betting he gives out trade calls in return for monthly payments - or gets a rebate from his broker introducing new clients etc etc - all this will effect his ability to say all his winnings are still tax free. Its a minefield - or as I like to call these situations - the real devil is always in the detail and the small print.
Finally - Why would your friend want to give up earning more tax free then take a job and pay tax - and earn less ?
Regards
F
Hi Forexmospherian,
Thanks for clarifying. It sounds like the person I was speaking with and you are on the same wave length and maybe you have been misunderstood here. ............................................................................
Do you think we were born yesterday. Nice try but you forgot the following giveaways:
* very very few posters use the hyphen - in their posts.
* you both appear to be be misspelling 'wavelength' as 'wave length'
I could go on but I wont.
I dare bet my left bollock that not 1 person in england is paying any tax on their spreadbetting profits.