Need a bit of help understanding UK Tax!

[Ali_d321]

Hey everyone,

I’m sort of new to the markets. I think it’s now a good opportunity to start investing money into companies in order to grow what’s in my savings.

I started learning about trading, understanding fundamentals, technical indicators etc.

basically, I plan to buy companies I feel are undervalued based on trading technicals as well as performance of the company itself, and where I see the company price heading between a couple weeks or a few months timeline. I’m only planning on buying/longing stocks. I feel like I have a chance after achieving with practice portfolio accounts.

But I’m worried about wether I get taxed for any money I make from this? Do I have to pay income tax and capital gains? Do I only pay capital gains?
I’m planning to use around £2000 of savings to continue teaching myself and grow into more money for my future. It’s really more of a ‘hobby’ I can spend my free time on and maybe generate like £40-£150 per winning investment.

I have a full time job that pays my salary

 

[MasterOfCoin]

Hi Ali_d321.

Welcome to t2w.

In the UK trading falls under the realm of Capital Gains Tax.

However, there is a very generous annual allowance before you become liable to actually pay any.

Unless you are planning or expecting to make returns of many times your stated stake, you won't be exceeding your allowance any time soon.

On the other hand, if you should suddenly make £20,000, please do come back and tell us all how you did it !!!

 

[Ali_d321]

Hi Ali_d321.

Welcome to t2w.

In the UK trading falls under the realm of Capital Gains Tax.

However, there is a very generous annual allowance before you become liable to actually pay any.

Unless you are planning or expecting to make returns of many times your stated stake, you won't be exceeding your allowance any time soon.

On the other hand, if you should suddenly make £20,000, please do come back and tell us all how you did it !!!

Thanks for your warm welcome .
That’s what I was thinking! There’s an allowance at around £12,000 per annum right? I definetly don’t think il be making more than that Lol

What I am more concerned about is income tax. If I happen to make maybe like £100/200 Every month or two, based on different companies I buy cheap then sell higher, do I have to pay income tax on this??

 

[MasterOfCoin]

If I happen to make maybe like £100/200 Every month or two, based on different companies I buy cheap then sell higher, do I have to pay income tax on this??

In short, no, you don't.