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CFD vs Spread Betting

Spread betting and CFDs (Contracts for Difference) share a number of common features and have some key differences too

Key similarities

  • Ownership – you don’t physically own the assets you’re trading
  • Stamp duty* – there’s no stamp duty payable on CFDs or spread betting
  • Margin trading – you only need to stake a proportion of the value of the trade
  • Choice – with both products you can trade in a wide range of assets including company shares, indices, currencies and commodities
  • Go long or short – you can trade on the assumption that values will rise or fall
  • Commission – when you deal with Spread Co, commission is included in the spread

Key differences

Spread betting  CFDs
Tax on gains* No Capital Gains Tax on any profits. Capital Gains Tax liability on profits.
Offset losses* You can’t offset any losses against gains made elsewhere. Any losses can be offset against other gains for Capital Gains Tax.

*Tax treatment depends on your individual circumstances and tax laws can change or may differ in a jurisdiction other than the UK.

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Spread Co Limited is a limited liability company registered in England and Wales with its registered office at 22 Bruton Street, London W1J 6QE. Company No. 05614477. Spread Co Limited is authorised and regulated by the Financial Conduct Authority. Register No. 446677.

Risk Warning: Contracts for difference and spread betting carry a high degree of risk to your capital and it is possible to lose more than your initial deposit. These products may not be suitable for everyone, so please ensure you fully understand the risks involved and seek independent advice if necessary. Click here for more information.

Losses can exceed deposits. Click here to learn more.

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