Definitely can be classed as a trader with those numbers.If you...

Definitely can be classed as a trader with those numbers.

If you class yourself as a trader, you can still have a second job/income.

You can claim losses on stock without actually selling them.

example: bought 5000 shares in XYZ at $1 (plus $30 brokerage) = cost $5030.
At close of trade 30th June that year XYZ was at 60 cents, but you still held all your shares, so the market value is only $3000.

In your 'Closing stock' tally you can use the lower of the COST or the MARKET VALUE. You effectively are claiming the loss...... but your new base cost for XYZ for the following year is $3000.

To work out your 'net income' for the financial year as it is essentially classed as a business, it is:

'Total value of stock sold' - 'total expenses associated with that obtaining that stock' where total expenses is:

(opening stock value(what was held at 1st July already) + total value of all purchases) minus the closing stock value(as at 30th June) + interest expenses(if you have a loan to purchase shares) + other expenses(internet, charting programs etc.)

By being classed as a trader, there are no CGT events, so if you hold a stock for more than a year you DONT get a 50% discount on any profits you make on that sale.

To make it more confusing and messy, you can actually have a separate account for INVESTING and another account classed for TRADING.

A good accountant will be able to run through all this. Definitely worth speaking to one.