If you are building account slowly and not taking any money out of your forex trading account, how do you file taxes on that?
I’d guess you only have the income once you withdrew your funds, so you shouldn’t worry about the money you technically don’t have yet.
Probably the best idea is asking your accountant for advice.
You should check the procedures in your country because I think that there are different rules with the different jurisdictions. In some countries Forex is not considered as an investing service so it is tax-free, in others if you prove that you trade only as a hobby - again, no taxes. So my advice would be to verify with the financial authorities just to be sure.
Thanks, I will check with accountant.
I think @sebastiano has a point here - in UK a number of years ago “Spreadbetting” (which is effectively what WE do ! ) is cnsidered a “non taxable” pursuit - Unless we start to win ! When the “main income rules” start to hit !
So - as long as we lose - it’s “non taxable” - ie No “claimback for losses” - but when we start to win - “they start to get interested !”
@Falstaff hahah that is a really weird law but at least the government is “transparent” - you lose --> we leave you at peace, you win --> start paying
I found an answer under tax rules in USA, it says I have to pay taxes as regular income even if I don’t take any money out of account. Does not seem fair.
doesnt this only apply to particular jurisdictions? and above a certain income…
If you have not taken out any money from your Forex account yet, then, I don’t think that there is anything to worry about because the money has not reached your bank account yet.