LION63,How many of you have sought advice from an accountant regarding this issue of taxation? How many of you have bothered to read the HMRC guidelines about this subject? The answer is simply very few as is obvious from some of the posts.
Spreadbetting is gambling which is tax free and not tax deductible. The only individuals/companies that are liable for taxation are those that are deemed to be 'Professional' or are vendors of products/courses that take positions in order to demonstrate the workings of those products or enhance their reputations as good teachers.
The level of proficiency or good fortune in the markets is not a determining factor in being a 'Professional' in the eyes of the law or HMRC. An individual who is proficient/lucky enough to make a profit in excess of £1million is not a 'Professional' and will not incur a tax bill even if that is the sole source of income.
There have not been any cases brought by the Inland Revenue in order to get anyone to hand over tax on gambling profits where they do not deem the individual to be a professional. The fixation with this topic is baffling and what is sad is that it almost seems like turkeys asking for Christmas. Beware as your wishes may eventually come true.
Let me see if I understand what you are saying correctly. Two people, lets say twins, identicle in every way including ability, attend a trading seminar and learn a particular trading style. They both open a trading account, the only difference being that Twin A opens a Spread Betting account and Twin B opens a Direct Access account. They trade side by side and call out each trade to ensure that they are both taking EXACTLY the same trades at EXACTLY the same time. At the end of the year, they have both made £1Million. Now, Twin A gets to enjoy every single penny of that £1Million, but Twin B must share a percentage with the HMRC. Next year, learning from his mistake, Twin B opens a Spread Betting account and by the end of the year has made another £1million. When the IR asks for their share he says "No, not this time. I did it all through spread betting" What you are saying is that the IR's response will be, "We're sorry, we thought you made it trading. No problem, you enjoy it all."