Spread Betting Calculator

Yes, for UK retail traders, spread betting profits are exempt from Capital Gains Tax, Income Tax, and Stamp Duty. HMRC classifies spread betting as gambling rather than trading financial instruments, because no assets are acquired or disposed of. This tax-free status has been in place since 1986 and was reconfirmed by HMRC guidance updated in October 2025.

The exception is if HMRC determines that spread betting constitutes your primary trade or profession, though this is extremely rare for retail traders. The tax advantage has widened in recent years as the CGT annual exempt amount fell from £12,300 to £3,000 and CGT rates rose to 18%/24%. For tax-efficient investing alternatives, see our Pension Tax Relief Calculator.

Margin is the deposit required to open a leveraged position. It's calculated as: Stake per Point x Entry Price x Margin Rate. The FCA sets minimum margin rates for retail clients: 3.33% for major forex (30:1 leverage), 5% for minor forex, gold, and major indices (20:1), 10% for commodities and minor indices (10:1), 20% for individual equities (5:1), and 50% for cryptocurrencies (2:1).

For example, a £10 per point bet on the FTSE 100 at 8,000 points with 5% margin requires £4,000 deposit (£10 x 8,000 x 5%). The full notional exposure is £80,000, meaning small market movements result in large profit or loss relative to your deposit.

Overnight funding (also called swap or rollover) is a daily charge applied when you hold a position past the end of the trading day (typically 10pm UK time). The charge is based on the notional value of your position, and the rate is usually the relevant interbank rate (SONIA for GBP) plus a broker markup of 2-3% annually. The daily charge is the annual rate divided by 365.

For a long position, you pay funding. For a short position, you may receive funding if the interbank rate exceeds the broker's markup, though this is increasingly rare. Costs accumulate significantly on positions held for weeks — always calculate total funding costs before holding a position long-term. For long-term wealth building, consider pension investing or savings instead.

Both are leveraged derivatives that let you speculate on price movements. The key difference for UK traders is tax: spread betting profits are tax-free, while CFD profits are subject to CGT at 18% or 24%. However, CFD losses can be offset against other capital gains, whereas spread betting losses cannot (since they're classified as gambling losses).

CFDs are available internationally, while spread betting is primarily available in the UK and Ireland. Both products carry the same fundamental risks of leveraged trading. The FCA requires identical margin rules and negative balance protection for both products. If you regularly make losses, CFDs may actually be more tax-efficient due to loss offsetting. For tax planning across all your investments, use our HMRC Pension Tax Calculator.

With FCA-regulated brokers, retail clients have negative balance protection, meaning you cannot lose more than the total funds in your trading account. However, because spread betting uses leverage, losses are amplified relative to your margin deposit. A £10 per point bet on a market that moves 200 points against you results in a £2,000 loss.

The FCA requires all spread betting providers to prominently disclose that between 69% and 82% of retail accounts lose money. Always use stop losses, never risk more than 1-2% of your account on a single trade, and never spread bet with money you cannot afford to lose. For safer long-term wealth building, explore our Workplace Pension Calculator and Retirement Age Calculator.

Yes, and you absolutely should. A stop loss automatically closes your position if the market moves against you past a specified level. Standard stop losses close at the best available price when the stop level is reached, but may experience slippage during volatile conditions or market gaps (e.g. overnight gaps on share markets).

Guaranteed stop losses ensure execution at your exact specified price regardless of market conditions, but carry an additional premium — usually a wider spread on the position. Most FCA-regulated brokers offer both types. The choice between standard and guaranteed stops depends on how volatile your chosen market is and how critical it is to limit your maximum loss to a precise amount.