Preparing for taxes in home currency

[nooby_mcnoob]

try trading CME currency futures as an alternative and see if it works for you. your gains or losses are always reflected in usd. Keep in mind this only works if you hold short term not necessarily 6 months or a year.

Not sure that I want to learn a whole new asset class just because I can't wrap my head around something obvious...

 

[rolando87]

Its not "a whole new asset class" trust me futures are easy to understand and you get good built in leverage. Study it for a few days you'll see it's a good tool to speculate on currency movements.

 

[nooby_mcnoob]

Its not "a whole new asset class" trust me futures are easy to understand and you get good built in leverage. Study it for a few days you'll see it's a good tool to speculate on currency movements.

That may be true, but does it make sense for me to move on without learning what I'm missing right now? I don't think so... I do have friends who speculate on currency using futures. Totally valid approach, just not the one I'm taking at the moment.

 

[nooby_mcnoob]

Hi Nooby.
You won't end up with more of one or less of another currency, because you are neither buying nor selling.
When you "buy" Eur/Usd, you are effectively betting that the euro will strengthen against the dollar. When the bet ends, I.e. you close the trade, any gains/losses are reflected in your account, in the currency you have chosen to use for your account.

The reason I'm not seeing this is because when exiting the short, I'm not converting the entire amount, just (for some stupid reason), the initial short amount. Need to tweak the algo. It's nothing special. Just my being a dumbass.

 

[sprstpd]

Not sure that I want to learn a whole new asset class just because I can't wrap my head around something obvious...

You should at least look into the tax implications of using futures rather than spot and see if that might be beneficial to you. I seem to recall there could be a difference.

 

[nooby_mcnoob]

You should at least look into the tax implications of using futures rather than spot and see if that might be beneficial to you. I seem to recall there could be a difference.

Great point. In my home country of Kazakhstan, forex can be treated as capital gains if you elect it to be so under a business. Something like that. Very difficult to find accountants who know what they're doing here.

 

[peter matthew matty]

Hi,

Sorry if this sounds like a silly question and please correct me where I'm wrong.

Say I am trading a foreign currency as the base currency and my home currency as the quote currency, so for example, GBP/USD.

If I short this pair, I end up with more USD. If I go long, I end up with more GBP. I need to pay taxes in USD. It seems kind of silly to have to convert my GBP at the end of the year in order to pay taxes in USD so the question I'm asking is do people set up their trading systems so they are only making USD from their trades?

Bud it all just depends on the country that you are paying your taxes in - If you were to pay the taxes within the USA than they would appreciate receiving US dollars from yer - On the other hand if you were to pay your taxes within the UK than it will all boil down to sound reasoning that they would expect your payment to be made through the Uk Pound System - Is this what you are looking for - Plus you have no taxes to pay anyway simply because you do not make enough money at this time to be concerned with Taxes Bud. - Alright - Is that OK with yer.