Question: My partner and I are resident in the UK and I trade CFDs from home to generate my only source of income. My partner works full time (and pays income tax at the highest band) but also trades CFDs as a secondary source of income. If my understanding of the material I have read on this site is correct, then my best option to reduce the tax bill on my own trading profits is to set up a company (will any off the shelf do?), pass any allowable expenses through my p&l (e.g. interest expense, portion of rent, electricity, etc) including my tax free salary allowance, claim Entrepreneur tax relief, pay corporation tax, then extract dividends, and leave the remainder in the company for now? Would be grateful if you could advise whether this is broadly correct. The question I have then is with regards to the best way to reduce my partner's tax bill. Am I able to pass her trading profits through the same company I'm using for mine and treat as above (except the tax free salary allowance of course)? In addition, we are considering a move to a tax haven in the next 12-24 months where we would both trade full time. Does this have implications on how I should structure our trading activities today? Any help or direction you could give would be very much appreciated. . . . (to read the remainder of this article, please log in below.)
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at 'YourTradingEdge' magazine and the author of 'The Investors Tax Bible'
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