[DARWIN] MOT by IlIlIlIlI

[IlIlIlIlI]

MOT will be closed.

As it looks like there is an technical issue, I had to write an email to Darwinex for that.

The reason is the upcoming changes for DarwinIA "classic" which will be moved an splitted to DarwinIA SILVER and DarwinIA GOLD.

Darwinex expects a minimum account balance of $ 1,000 for DarwinIA eligibility of real account Darwins, which MOT did not have and I'm not willing to increase the balance.

Reason for that:
The German tax law forced me to trade small accounts at Forex (and other asset trades defined as "speculative") as if the total of losing trades exceed 20k, it will be capped to 20k.

Example:
If a German private trader makes 10k profit with 110k total of all winning trades and 100k total of all losing trades, he last to pay taxes for 90k profit (100k winning trades minus 20k capped losing trades). The tax amount would exceed to profit made.

I just finished my tax declaration for 2021 and the total of losing trades exceeded 10k from the small account I used in 2021.
So there will be no cap for 2021, but I will not risk to run into that trap in 2023 or 2024.

For that reason DarwinexZero and FTMO are good for me as this runs on a business model and not a private trader sheme.
I'll see in future what is better for me.

 

[Rufus_Leakey]

The German tax law forced me to trade small accounts at Forex (and other asset trades defined as "speculative") as if the total of losing trades exceed 20k, it will be capped to 20k.

Example:
If a German private trader makes 10k profit with 110k total of all winning trades and 100k total of all losing trades, he last to pay taxes for 90k profit (100k winning trades minus 20k capped losing trades). The tax amount would exceed to profit made.

I just finished my tax declaration for 2021 and the total of losing trades exceeded 10k from the small account I used in 2021.
So there will be no cap for 2021, but I will not risk to run into that trap in 2023 or 2024.

For that reason DarwinexZero and FTMO are good for me as this runs on a business model and not a private trader sheme.
I'll see in future what is better for me.

Ouch. It sounds like Germany doesn't want retail forex trading or other speculative trading.

I guess a workaround would be apply to be a professional trader:
https://www.financemagnates.com/for...uld-kill-cfds-derivatives-trading-in-germany/

Additionally, German investors can entirely avoid the new taxes by applying to be professional traders, which only costs a few euros. This action, among others, would allow retail investors to structure their transactions to benefit from tax exemptions. In such a case, this phenomenon would eliminate the regulation beneficial effect as forcing traders to trade professionally would not diminish speculation.

But most retail traders probably wouldn't qualify.
https://www.brokerxplorer.com/article/esma-regulations-for-retail-and-professional-traders-1966

To be classified as a professional trader, one needs to qualify for at least 2 of the ESMA established criteria:

1. Size of portfolio: the trader must have an investment or financial instrument portfolio with a size equal to or greater than EUR500,000.00. The portfolio can include stocks owned, cash savings, mutual funds, and trading accounts. Property, luxury cars, and other non-tradable products are not included.
2. Professional experience: the trader must have worked in the financial services industry professional with the relevant leveraged products for at least one year.
3. Trade size and volume: the trader must have acquired trading experience, which means they have carried out significant trades at a frequency of more than 10 per quarter.

 

[IlIlIlIlI]

Ouch. It sounds like Germany doesn't want retail forex trading or other speculative trading.

There are very few Forex brokers residing and paying taxes in Germany and I don't know even one CFD broker here.

The traditional speculative trading in Germany is made by buying warrants (Optionsscheine) and is under control of a few banks as emissioner of these warrants. These warrants are not regulated under the 20k loss limit until they are knocked out worthless, so some emissioners buy them back on the knockout level for 0.01 EUR or 0.001 EUR to avoid this rule.
As the Forex and CFD market was growing also in Germany, they used an incompetent guy, who was the financial minister without any significant financial experience or professionality, to build this rule. Without adding any competence in any area he is now the chancellor here.

I can "trade" FTMO and DarwinexZero via my company as they want me to write an invoice before paying me.
The role is consultant, not financial adviser, and that is in full compliance with the authorities.

As the company is trading only demo accounts, there is not even a registration needed on an exchange.

Darwinex offers a professional account if you make a deposit of 500k EUR, as far as I remember it.

And thanks for your English links, I did not search for them.