London is one of the prominent financial industries in the world, so forex trading in the United Kingdom is highly regulated and promoted. FCA (Financial Conduct Authority) is the one overseeing the financial market and regulates the brokers. As such, UK forex brokers are required to be licensed by the FCA.
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Score
Broker
Country
Regulation
Min Deposit
Max Leverage
64
86
Exness
United Kingdom
Seychelles, Saint Martin, British Virgin Islands, South Africa, European area, France, Nigeria, Brazil, Nigeria, Brazil, Nigeria, Brazil
St. Vincent & the Grenadines, Seychelles, China, European area, Hong Kong, India, Indonesia, Spain, Thailand, Turkey, United Arab Emirates, Nigeria, Russia
If you are interested in trying one of the brokers in the list above, make sure to open the forex demo account so you could experience trading firsthand with virtual money. You don't even have to deposit any funds since the demo account is 100% free. It is also available in most brokers.
Yes, forex trading is legal in the UK. It is subject to regulation by the Financial Conduct Authority (FCA). The FCA mandates brokers to acquire appropriate licenses and authorization to lawfully provide forex trading services to their clients. Therefore, forex brokers could not legally offer their products and services in the UK without being registered under the FCA.
On the other side, forex traders in the UK are protected by the law when they trade in FCA-regulated brokers.
Yes, profit from forex trading is subject to taxation in the United Kingdom as a capital gain. The tax treatment of forex trading depends on the individual's status as a trader or investor and the specific circumstances of their trading activities.
Forex trading as a part-time job would fall under the purview of the Trading Allowance. You are free of any tax liability as long as your income from forex trading doesn't exceed £1000. Any profits higher than that threshold will be subject to taxation.
Here's the detail for Income Tax rates in the fiscal year of 2023/24:
Since forex trading in the UK is strictly regulated by the FCA, all the regulations follow the agency's guidelines. Here are somekey policies that may affect the way you trade:
Choosing the best broker in the United Kingdom involves careful consideration of various factors to ensure a safe, reliable, and suitable trading experience. The following are the most important aspects to consider:
FCA-licensed forex brokers are generally considered trustworthy, because:
The company has fulfilled FCA's minimum capital requirement. A dealer's license that allows the company to run a "market maker" business needs EUR730,000. An intermediary license where the company could facilitate STP execution needs EUR125,000. The cheapest is a restricted broker license in which the company cannot hold client funds, as it only needs EUR50,000.
FCA will monitor the company continuously to ensure the segregation of client funds, monthly report and audit, efficient management including AML and KYC procedures, and proper risk disclosure for clients.
FCA-licensed forex brokers are prohibited from manipulative trade practices, such as entering into positions against their clients. Brokers also should not make unrealistic promises or offering monetary benefits to encourage clients to take risky trading decisions.
FCA-licensed forex brokers should not offer extreme leverage. Since mid-2019, FCA requires brokers to limit leverage on CFD trading between 30:1 and 2:1.
The Financial Conduct Authority (FCA) is in charge of regulating the UK's financial market. A registered capital requirement of GBP100,000 and a licensing cost of GBP22,000 are required for registration, which can take up to two years to complete.