Tax Question

[beerwm]

I've been reading the ATO website, and was wondering whether CGT was the only tax a share trader would pay?

is there any PAYG requirements when trading day-in day-out or is it just an accumlation of CGT that a share trader pays at the end of the Financial Year?

Also, i'm currently applying at IB, having to fill out a W8BEN form.
Do i need to give my "Foreign Tax indentifying number" it states "optional".

Any help appreciated,

thanks

 

[experttipps]

from memory i was sent quarterly PAYG notices once i had completed a tax return where my PAYG collected by my employer was insufficient to meet my total tax liablility. That is the ATO then determined that I was potentially earning enough income from other sources including CGT on share investments to need to start paying extra tax for the next tax year.

So in effect i had no quarterly PAYG for the first year. although one should ideally keep a portion of your earnings aside for this to avoid pain when the lovely tax bill comes. I imagine you could phone the ATO and ask to have quarterly PAYG payments required of you to keep on top of this, based on your estimation of income.

experttipps

 

[GreatPig]

was wondering whether CGT was the only tax a share trader would pay?

If you are a share trader, and consider yourself in the business of share trading (as opposed to share investing), then you won't have capital gains at all. Gains are then just ordinary income, and essentially treated the same as dividends.

Another tax you pay is GST on brokerage, but if you have an ABN and register for GST, then you can normally claim it back. The down side is having to fill in BAS statements, usually every quarter.

is there any PAYG requirements when trading day-in day-out

Depends on how much profit you make. Not sure of the exact threshold, but if you earn enough (and that's not all that much) you would likely get hit with quarterly PAYG instalments.

GP

 

[beerwm]

regarding w-8ben form

anyone know what parts need to be filled out/