Reply: 2.1.1.1.1.2.1.1.1.1.1.1.1
From: Michael G
Rob,
My understanding, is the amount is the same (ie rate based on your annual income). But capital gains can only be reduced by capital loses, whereas income gains can be reduced by income expenses (business expenses).
For traders, the benefit is, as a business they can determine business expenses like rent, cars, etc. Practical costs they reduce their tax.
Whereas capital loses/expenses are less available.
On the other hand, the 50% CGT allowance for holding property for 12mths is only available for capital gains and not income gains.
Then again, the idea of trading is to have a higher turnover.
Not sure if that makes things clearer, but its more food for thought.
Michael G
From: Michael G
Rob,
My understanding, is the amount is the same (ie rate based on your annual income). But capital gains can only be reduced by capital loses, whereas income gains can be reduced by income expenses (business expenses).
For traders, the benefit is, as a business they can determine business expenses like rent, cars, etc. Practical costs they reduce their tax.
Whereas capital loses/expenses are less available.
On the other hand, the 50% CGT allowance for holding property for 12mths is only available for capital gains and not income gains.
Then again, the idea of trading is to have a higher turnover.
Not sure if that makes things clearer, but its more food for thought.
Michael G
Last edited by a moderator: