Tax on Capital Gain via Foreign Exchange

Dear Sir/Madam, I needed to exchange USD to GBP so support my living expenses in UK. I used a stock trader platform to conduct currency exchange transactions then moved away money from trader platform to a local UK bank.Please kindly help clarify my queries on whether I need to report capital gain/loss for the said activities. Pls see my example below: My Situation: (Activity 1) I exchanged USD to get 100GBP at a trader platform on April 10, 2022, then: (Activity 2) I transferred out 20GBP to a UK bank on May 5, 2022 and got a profit “gain” of 3GBP, simply due to rise in USD value then; (Activity 3) I transferred out the remaining 80GBP to a UK bank on March 30, 2023 and recorded a profit “loss” of 10GBP, simply due to fall in USD value (To sum up my capital gain/loss over the entire 2022-23 tax year, I experienced a capital loss totaling 7GBP!) My queries: I cannot tell whether the above activities are subject to Capital Gain Tax, if yes, (A) How should I report the “realized gain”? By single entry transaction on exact date or by lump sum gains over the entire tax year ( have many transactions in a year at different dates)? And how should I report those losses? Can total gains be offset against total losses? (B) What is the charge rate in a low income tax band? Where should I report these figures on a tax return form? Appreciate your guidance and advice. Many thanks and cheers

Dear Sir/Madam, Any feedback on the above? Since tax return deadline is approaching, would like to hear your guidance . Best regards and thanks.

Dear Sir/Madam, No need to reply on this thread as I have got an answer already. Sorry to disturb you. Cheers

Hi,

No, there are no tax implications from the exchange of currency for an individual, unless you are doing this as a trade, in which case you would be deemed as self employed and the gains treated a profits of self employment and subject to Income Tax.

Thank you.
 

Hi, I’m in full time employment and paying PAYE tax. So don’t complete any tax returns as it’s automatically deducted. I’ve now started experimenting with forex trading during the day and wanted to know when/if have to pay tax on earnings from forex and If I have to…what to do to keep my tax affairs in order. Also…if I put £20k in an ISA which I never use…is that still taxable? Thanks.

Hi,
You should keep a record of your transactions, so that you know which result in a gain and those that resulted in a loss in each tax year.  Capital gains tax is payable where the disposal value, minus allowable costs and losses, still result in a gain. Where the gain exceeds the annual exempt allowance, then you will have tax to pay.  
There is a calculator below to help with this, as well as a link to the realtime capital gains service (RTTCGT), where you report and pay your Capital Gains Tax.  
Tax when you sell shares
Please note that you need to have declared your gains using the RTTCGT service no later than 31 December, after the tax year that the gain arises, has ended. If you miss this deadline date, you are required to declare the gain in a Self Assessment Tax Return. Interest arising from savings in an ISA are not taxable, while they remain in the ISA.
Thank you.