Could i be regarded as a professional trader if binary options are my sole source of income
In fact, there are only two possible outcomes once the option expires: HMRC will almost always regard this as a form of gambling: Cases that have gone before the courts help to shed light on this. A more recent case Hakki v Secretary of State for Work and Pensions  EWCA Civ concerned a professional poker player who made a living through his winnings and who was facing a child maintenance payment order from the Child Support Agency.
The Court of Appeal once again confirmed the general principle that gambling is not a trade. So even if your only source of income is from binary options profits, it seems unlikely at present that profits would be deemed liable for tax.
But do not rule it out completely. The answer, in the majority of cases, is likely to be no as it is not classed as income for tax purposes. But as ever with tax, it all depends on the context.
Use this general guidance and consider your position carefully. It tends to have an inherent value in itself which carries CGT implications. See CG for the formal definition.
Binary options present individuals with the opportunity to benefit from fluctuations up or down in, for instance, the price of individual shares or the performance of indices such as stock markets or currency markets.
These are derivative products; which means you do not have any ownership in the underlying asset at no point do you own the share in question, for instance. In fact, there are only two possible outcomes once the option expires: HMRC will almost always regard this as a form of gambling: Cases that have gone before the courts help to shed light on this.
A more recent case Hakki v Secretary of State for Work and Pensions  EWCA Civ concerned a professional poker player who made a living through his winnings and who was facing a child maintenance payment order from the Child Support Agency.
The Court of Appeal once again confirmed the general principle that gambling is not a trade. So even if your only source of income is from binary options profits, it seems unlikely at present that profits would be deemed liable for tax. They will simply make you a better overall trader from the start. To successfully trade you need to practice money management and emotional control.
Introduction Video — How to Trade Binary Options These videos will introduce you to the concept of binary options and how trading works. Here are some of the types available: Will a price finish higher or lower than the current price a the time of expiry. These can often be some way from the current strike price. Select the asset or market to trade — Assets lists are huge, and cover Commodities, Stocks, Cryptocurrency, Forex or Indices.
The price of oil, or the Apple stock price, for example. Select the expiry time — Options can expire anywhere between 30 seconds up to a year. Some broker label buttons differently. Choose a Broker Options fraud has been a significant problem in the past.
Here are some shortcuts to pages that can help you determine which broker is right for you: Low minimum deposit brokers — if you want to trade for real without having to deposit large sums of money. Asset Lists The number and diversity of assets you can trade varies from broker to broker. Expiry Times The expiry time is the point at which a trade is closed and settled.
Expiries are generally grouped into three categories: Long term — Any expiry beyond the end of the day would be considered long term. The longest expiry might be 12 months.
Regulation While slow to react to binary options initially, regulators around the world are now starting to regulate the industry and make their presence felt. The major regulators currently include: Strategies and Guides We have a lot of detailed guides and strategy articles for both general education and specialized trading techniques. Beginners Guides If you are totally new to the trading scene then watch this great video by Professor Shiller of Yale University who introduces the main ideas of options: Best Time to Trade Lesson 2: Tools for Trading Lesson 3: Trading Breakouts using Pivot Points Lesson 4: How to Use the Fibonacci Tool Lesson 5: Risk Management Lesson 6: Variable Binary Options Lesson 7: How to Postpone Expiration Times Lesson 8: When Not to Trade Lesson 9: Going Mobile Lesson There are three types of trades.
Each of these has different variations. How Does a Stock Trade Work? Identify the desired expiry time The time the option will end. Put and Call Options Call and Put are simply the terms given to buying or selling an option. Are Binary Options a Scam? These simple checks can help anyone avoid the scams: Marketing promising huge returns. This is clear warning sign. Operators making such claims are very likely to be untrustworthy. A trader should know the broker they are going to trade with!
This would include email contact as well — any form of contact out of the blue. When taking a bonus or offer, read the full terms and conditions. Do not let anyone trade for you. Are Binary Options Gambling? Advantages of Binary Trading The main benefit of binaries is the clarity of risk and reward and the structure of the trade. Minimal Financial Risk If you have traded forex or its more volatile cousins, crude oil or spot metals such as gold or silver, you will have probably learnt one thing: Flexibility The binary options market allows traders to trade financial instruments spread across the currency and commodity markets as well as indices and bonds.
Simplicity A binary trade outcome is based on just one parameter: Greater Control of Trades Traders have better control of trades in binaries. Higher Payouts The payouts per trade are usually higher in binaries than with other forms of trading. Accessibility In order to trade the highly volatile forex or commodities markets, a trader has to have a reasonable amount of money as trading capital.