Share trading losses as tax deduction

[#1]

I am a salaried full time employee, salary on TFN.  I started share trading ( day trading) 2 months ago after doing lot of researches. Initially i was able to make profit on a daily basis. But now due to pandemic situation I think i am gonna loose about $20k. Can this be considered as income loss for tax deduction?  

I have the records for all monetary history, buying , selling, profit and loss statements. 

[#2]

anyone there to help?

[#3 · Accepted solution]

Hi @prado ,

Thanks for your question.

You can claim the loss as a deduction but you'll need to assess whether you've incurred a capital loss or revenue loss. This will dictate whether the loss can only be offset against capital gains or income from other sources.

Losses incurred in the business of share trading are treated the same as any other losses from business.

Capital losses on shares and units

Note that this only applies to a loss you get from disposing of investments – not where you have made a 'paper loss' on investments you continue to hold. For tax purposes, a loss isn't a loss until it is realised.

Thanks for your post,

JasonT

[#4]

Hi Jason,

thanks for the reply.  In my case I am a share trader and incurred revenue loss from closing (disposing) the share positions. so can the losses from this business be offset to my other income ( which is a fulltime salaried employee on TFN).  

For example I have paid $40k taxes from the salary (TFN).

I have incurred revenue loss of $30k from the share trading ( ABN).

Regards

Pradp

[#5]

anyone?

[#6]

Hi @prado

Thanks for getting back to us.

If you have determined that it is a revenue loss, it can be offset against income from other sources, e.g. salary or wages. Losses incurred in the business of share trading are treated the same as any other losses from business.

For more information about net income or loss from business, refer to our website.

Hope this helps.

Thanks, ChrisR

[#7]

Thanks Chris.