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Old 26.10.2011, 11:34
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Tax and income declaration on trading, ebay/ricardo, appstore etc.

Someone told me that a certain number of trades (day trading) classifies you as a professional trader and that you are then obliged to declare your positions on your tax return.

Can anyone shed any light on this please?
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Old 31.10.2011, 22:04
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Re: Day trading and declaration of taxes

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Someone told me that a certain number of trades (day trading) classifies you as a professional trader and that you are then obliged to declare your positions on your tax return.

Can anyone shed any light on this please?
Assuming you are not taxed at source, then you are filing a tax return. In that return you must list every single transaction during the pertinent year. The tax assessor will then determine whether you are a "professional trader" and assess you accordingly.

Professional traders are not entitled to tax-exempt capital gains. Instead the gains are added to income and taxed at the standard rate.
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Old 31.10.2011, 22:38
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Re: Day trading and declaration of taxes

i thought you got taxed on everything here
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Old 31.10.2011, 22:48
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Re: Day trading and declaration of taxes

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In that return you must list every single transaction during the pertinent year.
I only show assets held at 31.12 which is what I always thought is what was required.
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Old 01.11.2011, 22:40
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Re: Day trading and declaration of taxes

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I only show assets held at 31.12 which is what I always thought is what was required.
The form has columns for buy date and sell date. Would imply that you must list sold securities, too.
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Old 01.11.2011, 22:45
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Re: Day trading and declaration of taxes

Are you a day trader then? I would imagine you have to do a lot of trades and have no other primary job to fall under that definition.

Remember, you only pay taxes on your profits...
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Old 02.11.2011, 03:28
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The form has columns for buy date and sell date. Would imply that you must list sold securities, too.
I am not a day trader , but do trade when Mr Market is nervous!

It's holdings at 31 December , with a sell date on any holdings from last year that you no longer hold & a buy date for new holdings.

It's the same for bank accounts
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Old 02.11.2011, 10:03
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Re: Day trading and declaration of taxes

my assumption was that you declared all your trades and pay tax on them regardless of whether you are a 'day trader' or not.

i've never heard of this trading distinction in switzerland before - was the guy who told you this british? because there is such a distinction under uk tax law to determine whether gains/losses are taxed as capital or income.
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Old 02.11.2011, 21:45
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Re: Day trading and declaration of taxes

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my assumption was that you declared all your trades and pay tax on them regardless of whether you are a 'day trader' or not.

i've never heard of this trading distinction in switzerland before - was the guy who told you this british? because there is such a distinction under uk tax law to determine whether gains/losses are taxed as capital or income.
There is no tax on Capital Gains in CH except for immovable property, you might declaire trades to reclaim any dividend taxed at source.
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Old 02.11.2011, 22:21
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Re: Day trading and declaration of taxes

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There is no tax on Capital Gains in CH except for immovable property, you might declaire trades to reclaim any dividend taxed at source.
because there's no capital gains tax doesn't mean that it wont be taxed as normal income.
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Old 02.11.2011, 22:48
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Re: Day trading and declaration of taxes

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because there's no capital gains tax doesn't mean that it wont be taxed as normal income.
For an individual Profits are not taxable & losses are not tax deductable. As most people loose money it would be foolish to add it to income....
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Old 03.11.2011, 16:18
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Re: Day trading and declaration of taxes

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i've never heard of this trading distinction in switzerland before - was the guy who told you this british? because there is such a distinction under uk tax law to determine whether gains/losses are taxed as capital or income.
Australia has the same.
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Old 03.11.2011, 16:23
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Re: Day trading and declaration of taxes

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my assumption was that you declared all your trades and pay tax on them regardless of whether you are a 'day trader' or not.

i've never heard of this trading distinction in switzerland before - was the guy who told you this british? because there is such a distinction under uk tax law to determine whether gains/losses are taxed as capital or income.
No, I was told this by someone in Finance at Novartis. But he wasn't really sure, he just said I should look into it.
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Old 03.11.2011, 16:27
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Re: Day trading and declaration of taxes

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No, I was told this by someone in Finance at Novartis. But he wasn't really sure, he just said I should look into it.
Cant help much but I do know that they do make this distinction and the level or trades required to put you in the professional camp is actually very low. How is it then treated? Im not sure.
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Old 26.03.2020, 13:20
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Re: Day trading and declaration of taxes

Sorry for reviving this thread, how does it looks nowadays?

How many trades you need to do per day in order to be considered as a day trader?

What are the tax % on the earnings of buying and selling stocks?


Thanks!
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Old 26.03.2020, 13:55
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Re: Day trading and declaration of taxes

I do have some experience here as I'm classed as a professional trader, even though it's not my main source of income.

On the face of it, capital gains are exempt from taxes in Switzerland, and by the same token you can't deduct any losses. The way the tax office determines if you are "professional" is a bit arbitrary, and can vary from canton to canton.

In general, and not restricted to the below, they will class you as professional if:
It's your main source of income
You trade primarily in derivatives such as CFDs, options and futures and especially if you are a short seller of these instruments

If the amounts you trade are large (subjective I know, where chf100k may be large to you, it's peanuts to some) in proportion to your total trading account and assets.

You frequently use hedging techniques

Remember that just one FTSE future has a nominal value of currently +- £ 52,000, the (full) DAX € 237,000 and the SMI CHF 88,000 so if you are trading those or options around them over a period of time you quickly hit the spot where a tax inspector who is not particularly versed in margin etc will see you as trading a very large amount in relation to your assets.

You are frequently trading at least 10 times a day over a sustained period

If you are an employee and just trading equities and some long only equity options and don't fit the above criteria, then you really don't have to worry about CGT on your gains.

Not exhaustive but I hope of some help?
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Old 26.03.2020, 14:10
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Re: Day trading and declaration of taxes

This explains relatively good imo:

https://www.moneyland.ch/en/stock-ma...ofits-tax-free
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Old 26.03.2020, 15:42
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Re: Day trading and declaration of taxes

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I do have some experience here as I'm classed as a professional trader, even though it's not my main source of income.

On the face of it, capital gains are exempt from taxes in Switzerland, and by the same token you can't deduct any losses. The way the tax office determines if you are "professional" is a bit arbitrary, and can vary from canton to canton.

In general, and not restricted to the below, they will class you as professional if:
It's your main source of income
You trade primarily in derivatives such as CFDs, options and futures and especially if you are a short seller of these instruments

If the amounts you trade are large (subjective I know, where chf100k may be large to you, it's peanuts to some) in proportion to your total trading account and assets.

You frequently use hedging techniques

Remember that just one FTSE future has a nominal value of currently +- £ 52,000, the (full) DAX € 237,000 and the SMI CHF 88,000 so if you are trading those or options around them over a period of time you quickly hit the spot where a tax inspector who is not particularly versed in margin etc will see you as trading a very large amount in relation to your assets.

You are frequently trading at least 10 times a day over a sustained period

If you are an employee and just trading equities and some long only equity options and don't fit the above criteria, then you really don't have to worry about CGT on your gains.

Not exhaustive but I hope of some help?
Thanks! This is fantastic and clear
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Old 26.03.2020, 17:01
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Re: Day trading and declaration of taxes

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Interesting article, but there is one mistake. I quote:

"Example: You hold 300 Swiss shares and receive a dividend of 3 Swiss francs per share. The 900 francs of dividends must be added to your taxable income when you complete your tax return. The money deducted for the 35% anticipatory tax – 315 francs in this example – is returned to you by the tax office after your tax returns are processed."

In some cases, companies pay a return of capital in order not to have to deduct the 35% W/T. This mainly (but not only) benefits foreign investors who cannot claim the tax back. Julius Baer is one example. In this case the CHF 1.50 "dividend" is not actually a dividend, has no withholding tax applied and if you're not a professional, is not taxed.
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Old 26.03.2020, 19:38
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Re: Day trading and declaration of taxes

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I do have some experience here as I'm classed as a professional trader, even though it's not my main source of income.

On the face of it, capital gains are exempt from taxes in Switzerland, and by the same token you can't deduct any losses. The way the tax office determines if you are "professional" is a bit arbitrary, and can vary from canton to canton.

In general, and not restricted to the below, they will class you as professional if:
It's your main source of income
You trade primarily in derivatives such as CFDs, options and futures and especially if you are a short seller of these instruments

If the amounts you trade are large (subjective I know, where chf100k may be large to you, it's peanuts to some) in proportion to your total trading account and assets.

You frequently use hedging techniques

Remember that just one FTSE future has a nominal value of currently +- £ 52,000, the (full) DAX € 237,000 and the SMI CHF 88,000 so if you are trading those or options around them over a period of time you quickly hit the spot where a tax inspector who is not particularly versed in margin etc will see you as trading a very large amount in relation to your assets.

You are frequently trading at least 10 times a day over a sustained period

If you are an employee and just trading equities and some long only equity options and don't fit the above criteria, then you really don't have to worry about CGT on your gains.

Not exhaustive but I hope of some help?
Yes, very good description. To be honest trading futures in equities don't offer anything in the Long position but they are good for shorts and hedging. There is a way to minimize the use of futures. CFDs are just leverage products and can be dangerous even though they are very simple products due to high leverage. You can get in the long side same results as long futures with some volatile stocks and therefore avoid paying CGT. Short positions rarely one needs to take (unless a turmoil like the recent one). And still buying puts before the crash you will probably get same or more returns like shorting futures. Buying a few puts from time to time I doubt they will ask for CGT.
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