Tax consequences of trading CFDs

Nov 29, 2011

I work full time and supplement my income trading stock CFDs. So far in this financial year to date I have made around $20,000 how do I deal with this on my tax return?

Your net trading income should be shown in your annual tax return under the question “Net income or loss from business”.  It will be added to your other assessable income and taxed at your marginal tax rate.  Make sure that you
don’t forget to offset any expenses that you have incurred in gaining this income such as internet, journals, subscriptions, telephone and depreciation on your computer and any other equipment.

If you are using another entity, such as a company or family trust, then any trading income is to be shown in the business income schedule of that entity.

Based on your trading profit to date, expect to have to pay back some tax this year.  It might be a good idea to try and look at doing some tax planning and prepaying some of your expenses up to 12 months in advance such as subscriptions or interest on borrowings.  It is also a good idea to get on a registered tax agent’s lodgement program so that you get a bit extra time before you need to have to pay back the taxman. 

This article first appeared in the Jul/Aug 2011 issue of YTE Magazine www.YTEmagazine.com. Copyright Your Media Edge Pty Ltd 2011.

Tags: Chartered AccountantPersonal taxShares

Author: Mr Taxman

Comments

Post a New Comment

comments-rhsLatest Comments

  • "Definitely can claim the trips to customers and should be able to claim the trips to the observatory when you have the bulky equipment for the repairs. I would be curious to know how much you are at..."

    By: Mr Taxman at Dec 20, 2020 11:08PM

    Post: Claiming car expenses

  • "Hi mrtaxman, I am employed at my home office, I am usually required daily to attend our remote mountain top observatory. I need to check overnight correspondence, see if I will need supplies from..."

    By: Carl at Dec 18, 2020 1:40AM

    Post: Claiming car expenses

  • "If you operate under the logbook method then the fuel wil form part of your total fuel bill for the year which you then apply the business-related percentage. Doesn't matter if didn't get paid from..."

    By: Mr Taxman at Dec 01, 2020 6:44AM

    Post: Claiming car expenses

  • "I am running a small business as a sole trader. I attended some work related training the other day but forgot to pay for the fuel required to travel to and from this training with my business..."

    By: Liz Evans at Nov 30, 2020 4:22AM

    Post: Claiming car expenses

  • "I separate everything mate, when it comes to the taxman, so the numbers you see on the RHS of your Statement are not inclusive of your Swaps or Commissions. I have a P/L and then I have P/L of..."

    By: Greg Croot at Nov 23, 2020 11:26AM

    Post: Foreign currency trading