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Tax implications for CFDs?

Joined
29 January 2018
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Anyone trading CFD's in Australia for "business purposes" do you just pay regular income tax in the business section of your tax form? what business expenses are tax refundable..?

Spreads?
Commissions?
Data subscription?
Trading software?
Laptop?
Internet connection?

Do you declare your losses along with your profits? how do you calculate total income considering gains and losses upon closing different positions? do you use Mytax or do you lodge a paper return?

I will be contacting the ATO but hopefully I can pick up a few tips on here, thank you.
 
As usual, much "depends" on your status as a trader.
Assuming the ATO has accepted your status, there should be no problem with Brokerage, Commissions, Data subscription, and Trading software. But Spreads don't enter the calculation.
With Laptops, associated hardware, and Internet connection fees you need to be careful. Rarely would anybody use home computers for trading business only. If you're honest with yourself, you will admit that you'll watch the odd cat youtube video, read and write personal emails, maybe even check Facebook pages or join the Twitterati. None of that can be construed as business-related, nor will the ATO be inclined to believe so.
Over the last 18 years, I have split the costs of Internet access 50:50 and my tax returns have never been questioned. While my desktops were usually "owned" by the trading company, I left any tablets and smartphones that are used around the house out of consideration, even though trading software and other related apps are on them as well - and used when I'm away from the office.

Based on the fact that you're posting as a newbie and asking these questions in the first place, I'd suggest you not only ask the ATO, but see an Accountant with relevant experience at least for the first (two-three) Tax Returns. Ask very specific questions - including the ones above - and analyse his/her answers to make sure that they truly demonstrate relevant experience.
If you feel you know enough, you can do your own after a few years. Or you keep paying a fee for service and save your own precious time.
 
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