OK, getting straight to the point – now that the tax rate is capped at 18% does this make spread betting less attractive?
Angus: Spread betting is attractive for a number of reasons and not just because any capital gains are tax free under current UK legislation. The fact that you don’t have to do any calculations or tax returns whether the rate was 1%, 18% or 40% is a benefit in itself i.e. you can enter an exit a market as many times as you want without paying commission and of course if you make money, you don’t have tell anyone (or at least I wouldn’t!). Whilst many people comment on the capital gains advantage the really important bonus is no Stamp Duty. The total bid-offer spread on Capital Spreads platform for FTSE 100 stocks is just 0.1pc around the underlying bid/offer. This is 0.4pc less than Stamp duty alone and this is before considering the savings on commissions etc as well.
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