Hi,
I will soon be working as a Day Trader (from home) trading the forex / foreign exchange market full time, as my only source of income. How do I structure myself to pay tax? I am based in the UK.
My role entails buying and selling currencies via a retail broker (I have built up the necessary skills over a 5 years period and I am now at the stage of turning this into my only income, self employed).
I'm aware this is a grey area for the HMRC, which is why I am looking for clarification as to how I pay tax on any profits accrued. What process do I need to go though to set myself up as a self employed financial trader and how do I go about it please?
Please note: the way I will be trading is NOT spread betting, so my day trading will not come under the bracket of 'spread betting' or 'gambling'. I know it is possible for me to do the same with a spread-betting company and be tax-free, however, this is not the route I'm taking. I will be trading with a broker situated in Australia (non-spread bet related) and I wish to set this up as proper self employment, whereby I pay tax on yearly profits.
Is it classed as income tax, capital gains tax or business tax? Please bare in mind that no business structure will be set up, its just myself using my self-taught skills to generate profits from the financial markets on a consistent basis using the set up I have in place.
How would I set myself up to viably pay tax based on the above?
Thank you,
David Chester
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