The Trading Journal Tax Professionals Wish Existed

[Shadow Trader]

Good records turn a trading history into something that can be reported accurately. Tax treatment of forex gains and losses differs widely by country and by how activity is classified, so this is a topic for a local qualified tax professional. What can be said in general is that incomplete records are hard to fix later.

A practical log for a scalper goes beyond the broker statement. Useful fields include open and close timestamps with time zone, instrument, direction, size, entry and exit prices, commission, swap, and net result in account currency. Deposits and withdrawals should be recorded separately, with dates and the exchange rates or fees involved, since they are not profit or loss.

Platform exports can be saved monthly as PDF and CSV files in more than one location. Statements may become harder to access after an account closes or a provider changes, so waiting until year end is risky. Expenses such as data feeds, charting subscriptions, and software should be kept with receipts, along with notes on whether they relate solely to trading.

Where a local-currency figure is needed, the conversion method and rate source matter. Applying the same documented method consistently is generally easier to defend than mixing sources. Local rules on what is deductible or reportable should be confirmed with a qualified professional.

[FXS HongKong Scalper]

Agree on recording time zone with every timestamp. For traders in Hong Kong with a broker on New York close server time, the trade date on the statement can differ from the local date for trades after about 05:00 or 06:00 local, depending on the season. That's harmless until someone needs totals by calendar year or month, and then the trades around midnight server time land in the wrong period.

We also keep the exchange rate used for converting to the home currency on the day of each trade, and note the source. Reconstructing that later from memory is painful.