Binary Options Brokers in Australia
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Trading in the binary industry has been slow to establish in Australia. However, the last few years have seen a significant increase in the number of people enquiring about binary options in Australia and the relevant laws and appropriate tax legislation. This article should help you gain answers to all your questions and start generating funds through binary trading.
Legality of Australian Binary Options Brokers
There is no doubt that it is legal to Trade in binary options in Australia. Although a variety of regulations exist which must be complied with they are generally connected to the taxing of profits. Many Australians who are already trading are currently using the services of foreign registered brokers; in particular those based in Europe. These brokers may be registered in Europe but may not be registered as Australian binary options brokers. This does not make it illegal to trade with them; it does mean you need to exercise caution when creating an account.
Australia does have a regulatory body which monitors and controls the binary option brokers in the country. The Australian Securities and Investment Commission, also known as the ASIC monitors all financial instruments; binary options are considered to be a financial instrument and are, therefore, covered by their remit.
Because the market in Australia is relatively small there are very few brokers who have bothered to register with the ASIC; they prefer to register in Europe where the much bigger market is. There are also a specific set of criteria which must be met if they wish to be a registered Australian binary options broker:
They must have at least one million dollars in assets, be able to separate client funds from their own funds and adhere to all Australian money laundering guidelines. They must also be able to understand and adhere to the Know Your Client procedures which Australia has established.
Brokers based in Europe can become registered with just one country and offer registered services to all European countries; this makes it a much more attractive and easy prospect that registering in many different countries; which would be necessary if they wished to be ASIC approved. This is why binary options in Australia are generally limited to offshore brokers.
Tax and Binary Options Australia
The Australian authorities are very strict in respect of their requirement for all traders to report their financial profits from binary options trading. These profits are usually considered to be capital gains and they will be taxed under the appropriate laws. Of course, there are slight distinctions depending on exactly where you live and it is vital to check before you start trading.
It does not matter whether your earnings are from an Australian registered broker or a foreign registered one. As an Australian citizen and resident you will need to declare your earnings; there are stiff penalties if you do not.
To ensure you comply with all necessary regulations you should take advice before you sign up with an Australian binary options brokers or even with a foreign one. Part of this process is looking at recommended brokers and reading reviews of your potential choices. If a broker offers a practice account then this is an excellent way to test the water without exposing yourself to any risk. Once you have chosen a reputable broker and understand the rules of trading, you can enjoy a substantial second income.