Compare: Spread Betting vs CFDs vs Trading
Frequently Asked Questions
Is spread betting tax-free in the UK?
Yes. For the vast majority of UK residents, spread betting profits are completely free from Capital Gains Tax and Income Tax. HMRC classifies spread betting as gambling, and gambling winnings are not taxable in the UK.
Can spread betting losses be offset against other gains?
No. Because spread betting is tax-free, the opposite also applies: losses from spread betting cannot be used to offset capital gains or income from other sources. This is an important trade-off compared with CFD trading, where losses are tax-deductible.
Could I be taxed on spread betting if it is my only income?
This is very rare, but HMRC could in theory classify a professional spread bettor as carrying on a trade if spread betting is their sole and structured business activity. In practice, HMRC has not successfully taxed a spread bettor in the UK. However, if you are concerned about your specific situation, consult a tax adviser.
How does spread betting differ from CFD trading for tax?
Spread betting profits are tax-free; CFD profits are subject to Capital Gains Tax at 10% or 20% depending on your income band. CFD losses can be offset against other capital gains, whereas spread betting losses cannot. Both are leveraged derivative products tracking the same underlying markets.
Do stamp duty or other taxes apply to spread betting?
No. Spread betting is exempt from Stamp Duty Reserve Tax (SDRT) because you never own the underlying asset. There is no financial transaction tax, no CGT, and no income tax on profits for UK recreational spread bettors.