In the UK spread betting profits are exempt from capital gains tax. Is that what I am doing with my CFD gold trades?

**Bottom line 🏁:** No—your leveraged gold positions executed via Contracts for Difference (CFDs) do **not** enjoy the same tax-free status as UK spread bets. Under current HMRC rules, profits (and losses) on CFDs are treated as capital gains (or, if trading is frequent enough to be deemed *employment*, income). By contrast, spread-betting gains are generally classified as “gambling winnings,” which puts them outside both Capital Gains Tax (CGT) and Income Tax for most retail traders. --- ### Why CFDs and spread betting are taxed differently | Feature | UK Spread Bet | UK CFD Trade | |---------|---------------|--------------| | **Legal classification** | Wager under the Gambling Act 2005 | Financial derivative contract | | **CGT** | ❌ No CGT | ✅ CGT applies above your annual allowance (£3,000 cut to £3,000 from 2024/25) | | **Income Tax** | ❌ None (unless HMRC re-classifies you as a professional gambler) | 🔄 Possible if activity is deemed “trading as a business”; otherwise CGT | | **Stamp Duty** | ❌ None | ❌ None (still exempt because no underlying share is transferred) | | **Offsetting losses** | No tax credit because there’s no tax | Losses can be offset against other chargeable gains | | **Regulatory leverage cap (retail)** | 1:20 for gold | 1:20 for gold (identical) | ### Practical implications for your gold CFD book 1. **Record-keeping matters:** Keep a log of every opening and closing transaction (date, size, price, fees). HMRC will expect you to calculate net gains each tax year—even if you ultimately owe nothing because you remain below the CGT allowance. 2. **Tax timing:** Gains are crystallised when the CFD position is closed. Open, unrealised P/L does *not* trigger CGT until settlement. 3. **Using losses:** If you’ve had losing trades this year, they can be carried forward indefinitely to offset future CFD or other capital gains. 4. **Professional status check:** If trading is your main source of income or looks systematic, HMRC could re-characterise profits as income—moving you into a higher tax band and removing the CGT allowance. ### Tips to keep more of your return 💡 • **Compare total costs, not just tax:** Spread bets often have wider bid/ask spreads, which can eat into the tax saving. Crunch the numbers before switching. • **Automate your logs:** Many UK brokers let you export a yearly P&L CSV—plug it into a simple spreadsheet so the CGT figure is always at hand. • **Plan around the CGT allowance:** If you’re near the threshold late in the tax year, consider delaying closure of profitable trades until the next fiscal year (but weigh market risk). --- **What would make tax season easier for you—help choosing a broker that provides cleaner annual statements, or a template to track your CFD P&L automatically?** 🤔