That’s the result of this being 1 giant thread with over 400 replies and opening it as a new topic would get merged into this anyway 
3 posts were merged into an existing topic: Wiki threads in the forum
A post was merged into an existing topic: Thinking about moving to Switzerland and live from passive income
I also once had a request to explain a big jump in wealth (maybe 30% or so). Filed the details and all was ok’ed later on.
I get those every year, since apparently the employee at the tax office can’t see where the realized P/L is on the report of IBKR - it always takes a 5’ call to tell them that I didn’t sell anything, hence it’s 0…
Even more funny is that on a comment from my side as to why they (their software) doesn’t calculate that based on entered sales/purchases the answer was “that’s not our job, but you have to give us a report from your bank”… I felt a bit perplex, but the tax office can be very competent and very stupid at the same time.
Yeah, funny how that happens sometimes…
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The Federal Supreme Court just published a court ruling for Geneva taxpayers couple.
Unsurprisingly, they tried to be classified as independent/professional investor so they could deduct their massive trading losses. The appeal was denied. The difference in treatment between 2013–2014 and 2015–2019 is interesting.
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The taxation periods 2015-2019 were not part of the decision (consid. 1.3.2). In the preceding 2 years, they just made trading losses, in total ~10 Mio (c. A.c.). It is established law that professional trading has to make gains (c. 7.2, 7.2.2, 7.3). The following years were taken into account for this question of profitability (c. 7.2.3). Other aspects were not examined (c. 3.1).
For the question of professional trading, the criteria of volume of transactions and the considerable amount of margin used are generally more important than the other criteria of systematic, planned trades or use of specialized knowledge (c. 7.1).
(En matière de commerce de titres, la manière de procéder systématique et planifiée, ainsi que l’utilisation de connaissances techniques spéciales, ont en général une importance moindre par rapport aux critères du volume des transactions et de l’engagement important de fonds étrangers)
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I have to admit that I’m not well versed in reading legal documents.
Do these judgements have any direct consequence or direct connection to the cases that we discuss here in this thread?
What do you think? Do they? Why or why not?
Maybe like this we can find out why you are unsure about it.
- yes, the federal tax administration has published a set of criteria to preliminarily rule out professional securities trading.
- yes, those include 6 month holding period, 5x yearly portfolio turnover less than 50% or yearly income, no borrowed capital and derivatives trading only to secure other positions
- no, if you occasionally violate one or even several criteria, you are not automatically considered a professional trader.
- no, no rando on the internet can tell you exactly how much or often you can violate them, and where exactly the line is drawn, and neither will the tax administration,
- so… don’t keep f****** asking about it.
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Go to the source: The tax admin is told by the Bundesgericht, what it can or can’t do. There, you will find further clarification:
For the question of professional trading, the criteria of volume of transactions and the considerable amount of margin used are generally more important than the other criteria of systematic, planned trades or use of specialized knowledge (c. 7.1).
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Small add: borrower capital with interest payments up to the amount of taxable income from your portfolio is also still fine.
Any idea if they count leveraged ETFs like RSST/UPRO as borrowed capital? My guess would be no as it all happens on the fund side.