Taxes for CFDs

[AnandRajendran]

Hi,

I am new to Aussie Tax forum. I have been trading CFD's for about a year. Last year I made a loss inCFD for about $8000 which according to my Tax agent was declared as Capital loss carried forward to the next year to deduct against any capital gains in the following years.

I read through many documents but get conflicting information. Can you help me here? Is income or loss from CFD trading to be declared to ATO?

 

[Cam019]

As I understand it, all capital gain/loss events must be declared to the ATO, including trading CFD's.

 

[Trembling Hand]

I read through many documents but get conflicting information. Can you help me here? Is income or loss from CFD trading to be declared to ATO?

Yes it is but the difficulty is whether or not it is a capital loss/gain or a trading loss/gain which is then considered income.

So it depends if you are "carry on a business of trading"

https://www.ato.gov.au/General/Capi...ng-as-investor-or-share-trading-as-business-/

I wouldn't automatically accept that a tax agent has done the correct thing here.

 

[skc]

I am new to Aussie Tax forum.

You'd probably get better answer from the Aussie Tax Forum... but this is only the Aussie Stock Forum.

I have been trading CFD's for about a year. Last year I made a loss inCFD for about $8000 which according to my Tax agent was declared as Capital loss carried forward to the next year to deduct against any capital gains in the following years.

I read through many documents but get conflicting information. Can you help me here? Is income or loss from CFD trading to be declared to ATO?

I think there are several different ways CFD profit and loss are treated, depending on your circumstance.

1. It's all fun and games like gambling and P&L are not taxable.
2. You are carrying on a business of trading and your P&L are trading income or loss (and not capital gain).
2a. You may be able to offset loss against current year income.
3. You are "investing" with CFDs and closed positions are treated as capital gains event.

There would be thousands of people who have had to deal with CFDs and taxes so there will be plenty of tax rulings available. Your account's advice may or may not be correct.

 

[Gringotts Bank]

I once made a typo in the address bar. Typed in Aussiesockforum.com.au. Those guys really know their socks. Recommended.