Prove it!

[Trader333]

From this point onwards i am not willing to pay Capital gains tax, unless it is proven in a court of law in the UK, that i am not gambling and that there is a proven way to profit from the global financial markets.

Good trading all.

In my view you have absolutely no chance at all of doing this. One issue is the laws that govern who regulates your trading provider. I cannot remember the source but I remember that there are different laws governing gambling to that of trading and as such you are unable to claim you are engaged in one activity as opposed to another if you transact through a trading broker as opposed to a SB company.

Also do consider the fact that you will need to have made a profit above the CGT threshold before paying any tax first before considering this as a major issue. The likelihood that you can win this case would have such massive consequences for the whole trading community that even if you did the law would be immediately changed to prevent it in future.


Paul

 

[Paul71]

Hello, Paul.

Does trading essentially mean a positive outcome in an individuals favour, over a given amount of time?

Is an individual guaranteed a positive result over any amount of time?

Ask any solicitor or member of parliment if the markets are guarenteed.

Are endownment mortgages or pension policies guarenteed?

There can only be one ruling.

I suggest traders work around this ruling.

Goodnight to you all and thanks, again.

 

[Trader333]

Paul,

What you are trying to do is not going to happen for the reasons I and others have given. If you don't pay any CGT owed then when they catch up you will prosecuted and any defense you offer will be shot down. When laws like this are made they have expert lawyers looking at every scenario and it is only very occasionally that something has been overlooked and someone in the public gets a ruling in their favour. Because of the nature of this then I would be pretty certain that every possible angle will have been covered.

If you are transacting trading through a company that is not classed as SB or a bookie then you are not classed as gambling and therefore your case is not valid in the terms of reference that you are trying to make. If you think about this then any UK company could argue that profits they make as a result of trading with others ie selling groceries etc is all just a gamble on making the right decisions. The profits are not guaranteed which is why companies do make losses but to argue that when Tesco or M&S make a huge profit it is just luck from gambling will not hold up in law and the same principles will apply to those (myself included) who use direct access to trade as opposed to SB companies.


Paul

 

[alexander]

Could anyone in a court of law prove that the price action of global financial markets obey certain rules?

Of course one can do that the same same extend that gas molecules obey certain "rules". Pressure in a gas chamber can go up or down depending on temperature, volume, speed of molecules, etc., the same way price goes up or down depending on how traders act.

But you cannot blame a specific trader or class of traders for the final outcome unless they have violated what is collectively agreed upon as being a "law of nature". For example, molecules in motion must adhere to Newton's laws. If the laws are found to be violated supposedly, this means that an external interference of some kind is present and it is not the case that the laws are false but that all factors affecting molecule trajectories are not known or disclosed.

Having said that, price action of global financial markets follows certain rules. One fundamental rule is that for every buyer there must be a seller and vice versa. All players must have equal access to information is another rule. But the most important rule is that when buyers are willing to pay more, prices go up and when sellers are willing to get less, prices go down.

The question is: given a certain price action can one infer that the rules are violated and there is external interference as in the gas molecule example?

Enforcement agencies deal with this issues every day and try to determine whether some players' actions are driven by inside information, manipulation (like pump-and-dump), front running , etc. They some times identify those "molecules" violating the rules but there are so many molecules and so few enforcement agents that the ability to detect illegal actions is limited.

Yes, you can prove in a court of law that price action obeys certain rules but that would mean nothing to the judges since "price action: cannot be accused of any crimes, only individual traders.

Alex

 

[donaldduke]

What is the difference between, Finspreads and, Interactivebrokers if there are no guarantees on the price movements of the global financial markets?

Why is Interactive brokers subject to CGT?

Why is Finspreads not?

Not one of these companies guarantee profit. Why should market speculation not be encompassed as gambling altogether,...unless individual profit can be proved as not being 'lucky'?

For a start Finspread pay betting duty whereas IB do not. SB is not completely tax free, the government does collect taxes from it, its just that the tax does not come from the winning punters net profit. As well as betting duty they also collect corporation tax from the SB companies. Since SBs make profits by bucketing trades this corporation tax is a percentage of the net losses made by punters. IB does not make its profits this way.

With SB the losers effectively pay the tax. With Direct Access the winners have too.

 

[blackcab]

Wouldn't primary purpose come into it? The primary purpose of betting is entertainment and the primary purpose of DA is profit generation? You're not taxed on church raffle winnings but you are on business profits. Just a thought.