What is the definition of a day trader?

Generally speaking, when people refer to day traders, they mean individuals who open and close a trade on the same day.

We at Decipher Tax provide tax advice to individuals who make profits from trading whether they open and close a trade on the same day or whether they hold positions for longer than a day.

Please note that our advice is for the benefit of individuals who open and close trades within a relatively short period of time with a view to seeing a quick return. This is as opposed to individuals who engage in trading activities as a vehicle for long term investments.

Who is your typical client?

Our clients are individuals who engage in day trading activities on their own account and trade any of the broad spectrum of financial instruments, be that cryptocurrencies, FOREX, shares or something else.

I have only just started day trading, should I be concerned about my tax position?

If you are day trading and treat your day trading activities as an occupation then you should consider how HMRC will view your day trading activities. This is whether you are in profit or your position is that of a loss.

After you’ve been trading for a few months we will be able to gain an understanding of your approach to day trading and determine whether you are liable to Capital Gains Tax or Income Tax; or whether there is a possibility of your day trading activities being considered as being speculative in nature.

I have been trading for some time but have never considered my tax position. Is this a problem?

This is not necessarily a problem.

The nature of day trading means that no two days are the same, let alone any two months or years.

The fact that the way in which individuals day trade can change rapidly might mean that the tax treatment of an individual’s trading income varies from one year to the next.

The potential variations in tax treatment of an individual’s day trading income gives us scope to look back over the time a client has been day trading and ascertain the tax treatment of their day trading income in each year.

Our advice is, if you’ve been day trading for a while and haven’t yet considered how HMRC will view the day trading profits you have made, don’t hesitate to get in touch with us, as we might be able to help you.

How much do you charge an hour?

Unlike a lot of tax consultancy firms, we don’t bill our clients on an hourly rate basis. Following an initial discussion to ascertain the complexity of your circumstances we will provide you with a fixed quote detailing the work we will carry out within this quote. You can then be confident that you won’t pay more than the quoted fee.