Actually, I was under the impression that income derived from CFDs is indeed taxable in the UK. US citizens can not escape tax, not matter what or where they trade. But as far as UK traders are concerned as far as I know spread betting is the only way to avoid paying tax on earnings, as it comes under gambling. "The primary consideration when considering CFD's vs Spread Bets is Tax. -------------------------------------------------------------------------------- Realised Gains from Spread Bets are not subject to Capital Gains Tax. An ancillary benefit then is that your tax returns are simpler - no representations are required. Realised Losses from Spread Bets are not deductible against other Capital Gains."
Spread bets are tax free in the UK. I believe CFD profits are subject to tax. Also i think most reputable companies wont deal CFD with US residents. Some dodgy ones might deal with a US resident directly. And some others will allow trades from an offshore company owned by a us resident. For example : http://www.igmarkets.com/content/sites/igm/en_GB/no_compliance.html United States customers Under existing US legislation, we are unable to enter into margin trading transactions with US residents. US Customers are defined as: any natural person resident in the US (other than on a short term basis); or a corporation or partnership incorporated or organised in the US, but excluding an offshore branch or agency of a US person that operates for valid business reasons and is engaged and regulated as an insurance company or bank; or a branch or agency of a foreign entity located in the US; or a trust of which the trustee is a US person, unless a non-US person has or shares investment discretion; or an estate of which a US person is the executor or administrator, unless the estate is governed by foreign law and a non-US person has or shares investment discretion; or any account held for the benefit of a US person.
Hmmmm. Well in a different thread several CFD companies that will deal with US citizens were exposed. See This: http://www.elitetrader.com/vb/showthread.php?s=&threadid=84733&perpage=6&pagenumber=10
Anyway I don't want my name tied to CFD's. Can't believe I got roped into talking about them. Sorry folks but no reason to trade them... Stick with futures.
Why would you want to anyway...many of these companies will only deal with you (US-based) in the 1st place if you have several million plus to burn... There's enough choices out there as is...