I am just wandering about the above topic because i saw a lot of automated forex trading robot sold
I am not sure what currency the purchase will be settled in at this stage but these are the most likly. If these currency appreciate in value between settlement am i libale for CGT - the proiperty is for perosnal use. Reply "No issue if your principal place of residence. Even of it wasn't then you are not liable for any appreciation due to forex until you ultimately sell.
Reply "sorry - i meant to say between now and settlemt, not onc ethe contract is signed. Also do these foriegj currency accounts need to be offshore, or can they be with an onshore australian bank, and do they need a balance less than ,AUD eqivelent to be CGT exempt? Note that you would need to declare any interest credited to these accounts in your Australian return plus claim any foreign tax credits ". Reply "Hi, While trading forex I have received profits of around 50k and a loss of around 70k, I don't have an ABN, could you please advise if this is put in at item 15 of my tax return or if the total loss can just go into d15?
Reply "f you are trading then this must appear in item 15 Business Income in your individual tax return. Reply "Hey Taxman, great site, thank you very much for all the helpful replies! I had 3K losses over and but have profits of about 5K in Can I subtract the 3K when I declare the profit? Reply "By all means if you couldn't claim the losses in prior years then they carry forward to future years and can be offset against future gains like yours in which is great news.
Reply "Hi Taxman, Great advice, thanks! Or some other kind of evidence? Reply "If you are in business then you should have an ABN. Reply "Hi Mr Taxman, read through the comments and there's lots of great stuff there. I realise it's a subject that's been covered a lot here so apologies if you feel like you are repeating yourself.
I'm just trying to get my head around the whole forex turnover test. I have been trading for about 3 years now and haven't claimed any of my losses or worked out tax. Mainly because it's been a tough slog learning and I haven't ended a year in more profit than I've invested in my trading account.
That's all fine it's coming good now. My question on the turnover is, how do I calculate that figure? Lets say I've invested 10k, i've traded for the last 2 years and if I add up all of my profitable trades, they come to around 30K. If I add up all of my losses they come to around 35K. So I'm not sitting on any profit for the year, but does that qualify me for the 20K turnover test? Or is it just the overall loss of 5K that I can offset?
Reply "Thanks for the response, sorry is that total gross turnover just for the last financial year or over the 3 years I haven't made any claim? Reply "For each individual year Sorry if I have some grammatical mistakes.
I have been in Forex trading last financial year. I was doing Forex trading casually. Most of my trade was online Gold which is not foreign currency although I had some foreign currencies trades as well.
Just wondering if I can claim my losses in my tax return or not? If yes please let me know what item in ETax software. Thanks so much in advance Alex". Reply "It is unlikely that you can claim Reply "Mr Taxman, I have traded Forex in a reular basis apart from my full time job, by investing 25K and finally end up in loss, of around 9k. Is this tax deductable?
This was my first time in forex and is not under any business entity. Reply "adding to my question, all profits exceeds K and losses happened unfortunately Reply "For some reason this took me a while to get my head round in etax. I was obviously missing a trick in regards to writing off losing trades as expenses.
Apologies if I'm the only dumb one and this was obvious for some. But for anyone like me trying to work out how to actually do this in etax here you go. Just one row with the total figure.
Then on the next page which shows your expenses in the other expenses table put the totals for; 1 commissions if applic , 2 Operating costs servers, training, tools, software etc etc. This is the most important part if you are at a net loss for the year and want to claim against your salary income. The step through and complete section When it asks if you meet the income test say yes providing you do of course and select "assessable income" as test to use.
Trader A invested 10K at the beginning of the FY. At the end of June they had a net loss of 5K ie the account was sitting 5k. But during the year all of the winning trades they had made totalled 20K and all of the losing trades totalled 25K. Do I need to pay the Australia Tax when I made profit? Reply "I don't believe you would. Reply "Yes you have got the concept correct.
Taxman, I have started my work in forex recently, and it is my sole occupation. I was just wondering if I apply for an ABN, would the tax rate be lower? Also, are there any deductibles applicable since I use my home space and Internet connection for my work? Thanks so much for your help in advance. Reply "You should be lodging a tax return regardless of income levels. An ABN doesn't change your tax rate at all - you need to be in a different structure eg company or trust in order for tax rate to vary.
Any expenses in relation to you deriving your assessable income eg computer, internet, desk, stationery, subscriptions should be claimable. Reply "Hi Mr Tax Man, 1. Forex trading cannot be clasified as capital gain or loss. Pls correct me if I am wrong. Reply "Can you please expand on why it's desirable for an individual trader to register for an ABN? Reply "Hi Mr taxman.. I made some profits on my forex account in the FY but in July lost all my capital and hence closed my account.
If the total profits were less than my original capital, is that still counted as profit and is tax payable on those profits? In a way, I could not even recover my original capital so not sure if the returns are still counted as profits? Reply "Sounds like you are bad luck with the timing of the financial year - so you would need to pay tax on the profits for the year even though you have subsequently lost.
Reply "Hi Gaiti, Sorry to hear about your losses on the Forex market. I hope I am not overstepping the bounds of this forum please let me know if so , but I run a business based in Australia that connects everyday investors to institutional level forex traders that you may be interested in.
Historical returns have been excellent. May be worth a look from your end. Feel free to contact me on shaunm strategyrev. Reply "A bit complex to do via email. Suggest that you try to find a local accountant to guide you. Taxman, I'm in a partnership business with my wife trading equity. How do I declare the dividend income in tax return? I found a forex broker based in Australia that I wish to open a trading account with.
Reply "The key is the source of where the profits are being made. If it is trading overseas is not Australia then no Australian tax obligation.
My accountant dismissed it saying that it would be considered a hobby at such a small size. Is there a point at which it's not a hobby or should I have ensured he realised the profit regardless of value? Reply "Hi Mr Taxman Great site. I am a foreign national who moved to Australia. I have foriegn currency bank accounts from my "home" country. There are two points I'm seeking to clarify: Is my tax realisation time in respect of the cash in these accounts the date I become a permanent resident in Australia?
So I would use that date to calculate the AUD equivalent of the currency in my "home" bank accounts? I have multiple accounts in my "home" country bank. I sometimes move money between these accounts e. Is moving foreign currency between my accounts at the same bank each account denominated in the same foreign currency a forex realisation event?
If I do what is the tax rate? Reply "Hi For information on taxes for australia binary option taxes you can also look here - http: Reply "What are the pros and cons of having an ABN vs not having one for the purpose of full-time currency trading? I will be transitioning into full-time currency trading shortly trading my own capital only and would like to ask whether it's necessary to register for an ABN for tax purposes?
If not necessary, how do tax returns work without an ABN for a full-time trader with no other income source? Reply "Hi mrtaxman, Which figure do I record in my tax return? The balance after losses taken out of profit or only the profit position. Compliments on your very informative site.
Looking through the comments on your forex page, it is sad to see the number of people asking you for advice in regards to how they should be accounting for capital losses as a result of their trades on the forex market. No-one wants to lose money, but unfortunately this is a reality for the majority of traders in this space. This fact is one of the reasons why I have started a business here in Australia that connects everyday 'retail' level investors with institutional level traders who have a proven track record of generating 'wholesale' level returns.
Should you, or any of your readers on this site be open to this type of service, please feel free to email me at shaunm strategyrev. Incidentally, we are fully licensed to market these products as corporate authorised representatives of the brokers we partner with here in Australia. Finally, I am aware this post may be somewhat borderline in terms of the content you wish to see on this site. Please let me know if I have crossed this line. Yours in health and financial wellbeing, Shaun.
And if it is a loss, can I offset my income tax? Reply "hi Mr Tax man, I am trading fx and have made lossess in last year. Would it be my profits which is less than that or can it be determined by another way. Total trades i did was around Also is there a way we can claim the loss in D Tax man, I have been living offshore for 5 years prior to being made redundant in HK in Jan I have not worked in Australia since Sep so have been a non-resident for tax purposes during this time.
I spent much of traveling but returned to Australia in Oct to look for work internationally. I have offshore savings that i would like to bring back to Australia. At what point am i a tax resident in Australia such that i will need to declare these foreign currency gains as income? Or at what date should i be measuring my currency gains from? Reply "I have been trading for last 5 years and have been losing. This year based on my learning I anticipate making profit.
Can I allocate the losses of earlier years against the profit in the current year. I have not been filing any returns as I am unemployed. Taxman, not sure are you still active on this blog or not but I am hoping you are. Currently I am residing in Malaysia. I would like to trade foreign currency with one of the broker in Australia, do I have to pay Australian Tax? Reply "Hi Mr Taxman, I have purchased foreign currency with Australian dollars approximately 3 years ago if I realise a substantial gain will I pay full capital gains tax or a reduced amount for having the investment for more than 12 months?
I invested into FX trading through a foreign broker outside of Australia. How do i report my income from all these trades and how much tax will it be subjected to? When I report my trading activity for taxation do I need to show each individual trade converted back to Australian dollars or am I able to just show the end of year profit or loss converted?.
If the former do you know of any accounting software that will do this as I have a lot of entries to convert. Reply "Cam, I have to do this myself mate, if you can convert your data to excel then go to http: You can then grab all the historical data from there mate.
It seems based on the definitions given that if one buys and sells foreign exchange through a forex broker in other words a forex trader for the purpose of deriving income through the disposal of said assets, then it is deemed as a revenue asset ss34 and 35 , but it would it not also be deemed a capital asset on account of the interest earned whilst the position is open?
Reply "I am a proprietary trader for forex with a forex education company. I took a course with a fee, but prior to the course we were required an ABN, would that mean the course fee can be treated as expense and can be claimed? Its a descent amount of 20k. Im still very knew and still learning, got no income yet. Also, is there a tax agent in sydney area that you know who can help me for the tax filing?
Reply "Hi Mr Taxman, inlaws home in UK transferred into names of their three kids some years ago with 'trust' put in place to allow them lifetime free use of it until their death. Father died some time ago and now mother has had to go into high care so home has been sold with funds put into trust account until her death. Not wishing her death of course but i have been asked to check options.
How do I take this trading loss out of my assessable income on etax thank you". I currently use Xero to import all my transactions and reconcile my accounts from my ANZ business bank account.
My Question is in relation to the reporting of these activitys. When reconciling my business cheque account should I mark this initial deposit as personal drawings from the business? I have no intention of withdrawing any time soon as I want to grow the capital. Or is it sufficient to report a end of financial year account balance? As till I withdraw these funds it is not effecting the balance of my bank account that I typically report on.
Im using a Offsure broker in Cyprus. Reply "Hi Mr Tax man I have decided to trade forex under a company structure. Can I claim the forex course under tax and can I claim a new computer and software and office expenses undertax. What other expenses can I claim if I am running my forex trading as a business under a company structure? I made roughly 50 trades. I have an ABN which I registered against the account.
What are my options at tax time? Can I claim against my income or is it a capital loss in Australia? I have less than zero interest in trading ever again and don't think my ABN will record a profit going forward. Taxman, Very informative, thanks! Is is possible to claim FX losses on goods?
Can this loss be claimed? Thanks for your insight. I have been paper FX trading and I am finally come good. A very general question and I apologise if it has already been asked. In terms of tax, say if I made a gain of , AUD in one financial year, generally, how much would i have to put aside for tax purposes? When would I have to pay the tax in both cases? At the end of a financial year, like a regular job?
Can I claim my tax refund as a return after taxfile. Appreciate your confirmation and guidance. Reply "I'm from the UK but live in Australia. I want to trade forex on a UK account from Australia. Should I declare any income from the UK account? Reply "I live in Oz but for some reason opened a trading account with a broker based in Cyprus and lost a few hundred.
Are losses treated the same for this? How should I declare this gain in my Etax? My income from work is around 95k. Thank you very much. Taxman, I am an indian national currently staying in thailand since last 10 years If I open a forex trading account with an Australia based forex broker and make profit in it, then do I have to pay any taxes to the australian government? Reply "Hi mr taxman, I recently started binerary trading , my trading volume was over 20k , however I have a net financial loss of 8k for the year.
Can this be claimed against my personal income? Regards, Ben J http: Taxman, I think this question would have been commonly asked as of late. I'm trying to complete my taxes and my questions are quite specific: Given these were in USD, but when calculated in AUD, the amount would be much greater for example, would I be able to claim against FX losses as well on top of my net investment losses incurred?
And similarly, would this carry on forward to the next financial year as well? Thanks in advance for your help". Reply "Hi Mr Taxman, I trade in us options through an australian company which is based in eastern states. I need to know the income i derived through this will be foreign income or australian income as i am in australia.
I do get paid some dividends as well and there is foreign tax withheld on them. Thanks in advance for your help. Reply "Hi Mr Taxman, I noticed you said that it depended where the profit was made as to whether tax is liable.
When I bring money down from the account into my bank account in Australia is that a simple case of personal income or is it tax free as money is not made here in Australia? I notice you haven't answered any questions for a while, so hope that you answer this one: I just started trading forex full time.
I have been trading for the last 3 months - frequency is at least 1 trade a day. Will it be considered as Business for taxation purposes?
I am trading miniscule amount for learning purposes. Until i withdraw funds, do i need to mention this in my taxation? Will it be treated a regular income?
In case if i start getting big returns in future, do i need to use ABN? Your help would be appreciated Reply "I am a disability pensioner. I have an equity account trading shares and am now looking at trading the forex market with a UK broker. Would the forex trades be regarded as overseas income and therefore not taxable in Australia.? I do not have a taxable income at present so what would my tax obligations be.?
Reply "Hi, my father who is a foreign resident transferred wants to invest in Australian shares. He will be coming to Australia to meet a broker and inest the shares soon. Will I or will he have to pay tax on any forex gain? I reside in Australia and wanted to know if my profits are taxable and at what rate? I have been trying to find some info on this, but just couldn't find it. Or maybe I'm looking in the wrong spot. If you could please let me know that would be much appreciated.
If you need any further info, please contact me via my email. And if I can how many percent could I claim back? I made a about k during brexit and I was wondering the best way to bring back the funds untaxed. Reply "I currently trade Foreign exchange part time due to wor commitments but with the help of technology I have the ability to make it fulltime but not be there. Is there reasons for it to be sanctioned as requiring a AFSL bring the fact it is a signal you are providing and not advice.
Great work mate, Greg". I have been trading forex with Vantage FX as part of my uni course - but it required I use my real funds. I dont have an ABN or anything like that. I like to do my own tax online. Where do I put this loss on my tax return?
My question is will I be taxed for any trading profits in such circumstances? I have deposited k AUD in a USD bank account not Forex trading last financial year and withdrew in several portions up to this financial year till all deposit withdrawn and made an overall loss of less than AUD.
Would this be considered as a business loss or capital loss? Is 20k turnover rule apply for this one if I want to offset it against my regular income? Reply "Also, can I claim this in last year's tax return which is due or I have to leave it for current year's tax return?
And of course all type of investments have their own risk. Even life is a constant risk. But if you know what you are doing and follow the rules the risk is minimized and the rewards are great. Of course compoundind weekly will give more returns than yearly. But compounding early was just an example, because the rule is to add capital as far as the account reaches higher equity and the EA will calculate, the new lot amount to trade, based on that new equity, meanning that compounding will depend on how many times new equity are reached annualy.
And I do not think its fair Txcmon coming always to this blog trying to "sell" Megadroid. You Daniel already made your point about that robot. So in my opinion discussion about the merit or not of that robot should take place in another forum. Sorry Txcmon, I do not mean to offend you, but thats my opinion.
You could have made your point without mention that robot. The monthly additions are easily calculated. During 20 years of USD additions you will have K added as savings. They are a significant amount of capital but the amount they represent of the total changes depending on the actual profit gained. The concept of facing "wipe outs" is simply not acceptable. I use automated trading systems for the long term and the way in which I continuously evaluate them allows me to stop trading them if they face a worst case scenario which will in NO CASE be even close to a wipeout.
In addition, NOT adding money to an account will doom you to low profitability since your ability to compound will be awfully limited. For me, the way you are approaching long term trading is very unsound. You are using a system you do not understand you don't know the exact logic behind it with backtesting results that are not reliable therefore you have no knowledge about long term profitability and with a terrible broker dependency problem due to spread widening and other such things your backtests are probably GREATLY under estimating draw down due to these issues as I mentioned on an earlier post.
Please don't take this the bad way: It would be great if you could join asirikuy and watch all the videos there. I honestly feel that you would like them: Anyway, thanks again a lot for your comment: Thanks a lot for your comment Cador: I am glad you have liked the post!
Of course, there is a lot more to reaching this long term profitable goals than just running the systems. Using automated trading systems is far more than setting up a robot and forgetting about it and this is what will mainly protect people who are aware of the 9 other reasons mentioned on yesterday's post.
You need to constantly understand, expect from and evaluate your trading systems. Something which you simply cannot do with a system you do not fully understand. I chose yearly compounding over monthly or weekly compounding mainly because I wanted to portray a worst-case scenario regarding compounding rate with the system maintaining average yearly profitability because otherwise compounding calculations may reach unrealistic results which may get people excited and encourage the use of unsound trading tactics, systems or excessive risk.
Backtesting and live trading has shown that several of the systems available at Asirikuy may actually compound at a much faster rate. Regarding the mentioning of Megadroid, I am actually not bothered by that but I am truly concerned about the fact that Txcmon is trading a system as long term profitable when there is no evidence of this being the case with the evidence NOT being reliable as I pointed out. Even more, as I mentioned on the previous comments, trading a system one does not understand is a road to failure in the long haul.
However as you say, in the future it would be best to keep references to the robot away from the discussion and within the posts pertaining to that system. Thank you very much again for your comment Cador: I am learning about Forex and have 5 books on it and any other books I can find. Since you are the mathematical people could you do a bit of calculating for me And how would that work with your compounding system.