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Rakhi Vasavada
Rakhi Vasavada, Financial and Legal Consultant
Category: Finance
Satisfied Customers: 4417
Experience:  Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years
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Tax return..I work full-time and also have income from

Customer Question

Tax return..

I work full-time and also have income from forex trading, which I believe is liable to income tax according to the advice I've received.

1. Which section does the income from forex trading go under in the tax return form? and..

2. Which section do the tax deductible expenses fall under? What needs to be included in the calculations? Do I include copies of receipts? What needs to be included in the calculation - is there a sample calculation available?
Submitted: 2 years ago.
Category: Finance
Expert:  Rakhi Vasavada replied 2 years ago.
Dear Friend,

Hello and welcome. Thank you for providing us an opportunity to help you.

I notice that this is posted in UK tax, but this also shoes as having originated fro United States.

Are you asking this question fro UK tax point of view? Are you in the UK ?

Please clarify so that I can assist you in best possible manner.

Warm Regards
Customer: replied 2 years ago.
Hi Rakhi, yes I'm in UK and want to know from UK tax point. I don't know why it's showing as originated in UK.
Expert:  Rakhi Vasavada replied 2 years ago.
Dear Niraj,

Hello and welcome again. Thank you for your reply. Let me come straight to the point and I will see that my reply remains crisp, concise and directly useful to you.

To begin with, you have been very correctly advised that if you have income from forex trading, it will be liable to income tax (not capital gains tax). This fact remains true irrespective of your status of employment. It makes no difference if you are not working, working as self employed or employed elsewhere.

In any case, the income derived from forex trading would be chargeable to income tax irrespective of anything.

Further to this, note that HMRC refers to 'trade' as running a business - not to be confused with trading/investing. So, when you compute your total income, this income will also get added to that as well.

All expenses incurred with relation to your forex trade would be allowed for deduction. All expenses such as tax advice, investment counsel/advice, interest on money borrowed to invest, monies spent on subscription of journals / business data, etc would remain deductible.

Yes, you will need to include receipts as well. Since all expenses should be itemized and deducted, there is no format available for this. You will deduct these expenses as you would normally do in any other case.

I hope I am clear now and this would now help.

Let me know if you have more questions. In future, if you need to reach me directly, you may prefix your question with "For Rakhivasavada......" and you will reach me.

Warm Regards
Customer: replied 2 years ago.

Hello Rakhi,


 


Thanks for your response. Yes, I've already established with your help from previous question that this should be income tax - that's not my question.


 


I'm completing the tax return myself. I'd like to know.. on the tax return form (http://www.hmrc.gov.uk/forms/sa100.pdf), where do put the forex income (under which section)?


 


I was thinking maybe is falls under the section 2 - self employment. Supplementary form for this section is at http://search2.hmrc.gov.uk/kb5/hmrc/forms/view.page?record=HgZl_CADaKU&formId=3182. However, this asks for business description and business postcode. Given that I'm not registered as a business, I'm not sure if this is the correct section.


 


Please let me know if I can further clarify my question.

Expert:  Rakhi Vasavada replied 2 years ago.
Dear Niraj,

Hello and welcome again. Thank you born your follow up question. I Torbay or question clearly.

You would report this income, to the best of my knowledge on page 3 item number 16 under head, "Other UK income not included on supplementary pages".

I hope I am clear now and this would now help.

Let me know if you have more questions. In future, if you need to reach me directly, you may prefix your question with "For Rakhivasavada......" and you will reach me.

Warm Regards
Rakhi Vasavada, Financial and Legal Consultant
Category: Finance
Satisfied Customers: 4417
Experience: Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years
Rakhi Vasavada and other Finance Specialists are ready to help you
Customer: replied 2 years ago.

Thank you Rakhi

Expert:  Rakhi Vasavada replied 2 years ago.
Dear Niraj,

You are most welcome. It was total pleasure assisting you.

Warm Regards