Have I hit premium charge now?

[ija34]

Hey all,

I was just scrolling through betfair and noticed the premium charge tab had appeared which I had read would happen when you become profitable. In all honesty, I thought my account was on a loss but its saying my gross p/l is over £2000. Does this mean when I am in profit for a week I'll now pay the premium charge?

Also, it says I have an available allowance of £956.61. Does this mean say I earn £2000 in a week then I'll pay 20% of (£2000 - available allowance - commission already paid)???

[Kai]

Hey all,

I was just scrolling through betfair and noticed the premium charge tab had appeared which I had read would happen when you become profitable. In all honesty, I thought my account was on a loss but its saying my gross p/l is over £2000. Does this mean when I am in profit for a week I'll now pay the premium charge?

Also, it says I have an available allowance of £956.61. Does this mean say I earn £2000 in a week then I'll pay 20% of (£2000 - available allowance - commission already paid)???

You technically started paying PC but you have to burn through your allowance first

[ija34]

Hey all,

I was just scrolling through betfair and noticed the premium charge tab had appeared which I had read would happen when you become profitable. In all honesty, I thought my account was on a loss but its saying my gross p/l is over £2000. Does this mean when I am in profit for a week I'll now pay the premium charge?

Also, it says I have an available allowance of £956.61. Does this mean say I earn £2000 in a week then I'll pay 20% of (£2000 - available allowance - commission already paid)???

You technically started paying PC but you have to burn through your allowance first

So you basically get £1000 free so had I not been given an allowance, I would have already been charged £43.39 in premium charges?

[Kai]

Hey all,

I was just scrolling through betfair and noticed the premium charge tab had appeared which I had read would happen when you become profitable. In all honesty, I thought my account was on a loss but its saying my gross p/l is over £2000. Does this mean when I am in profit for a week I'll now pay the premium charge?

Also, it says I have an available allowance of £956.61. Does this mean say I earn £2000 in a week then I'll pay 20% of (£2000 - available allowance - commission already paid)???

You technically started paying PC but you have to burn through your allowance first

So you basically get £1000 free so had I not been given an allowance, I would have already been charged £43.39 in premium charges?

Exactly, congrats

[ija34]

You technically started paying PC but you have to burn through your allowance first

So you basically get £1000 free so had I not been given an allowance, I would have already been charged £43.39 in premium charges?

Exactly, congrats

Yayyy!!

[Kai]

So you basically get £1000 free so had I not been given an allowance, I would have already been charged £43.39 in premium charges?

Exactly, congrats

Yayyy!!

You could try get your comms up (check older trheads) but if you're a pure trader you're probably stuck paying it

[ija34]

You could try get your comms up (check older trheads) but if you're a pure trader you're probably stuck paying it

Yeah I'm getting into pure trading. Mostly scalping and swing trading but may also Trade the big football events. So basically since I pay 2% commission. It'll work out that I pay 18% premium charge which in total is 20% of my total weekly earnings? I don't see it a massive problem at the moment tbf because it's the same charge as tax but when it hits 40% or 60% , it doesn't seem worth it. You're doing all the hard work and Betfair are basically stealing most of it. If I was earning over £100k a year, I could accept 30% but 40-60, I think I would struggle with that.

Earn £200k in a year and you walk away with either £80k or £120k. Wow

[Derek27]

Also, it says I have an available allowance of £956.61. Does this mean say I earn £2000 in a week then I'll pay 20% of (£2000 - available allowance - commission already paid)???

No. It would be 20% of £2000, which is £400, less commission generated, not paid, and that would be deducted from your allowance of £956.61. It's quite complicated, have fun reading the link below.

https://www.betfair.com/aboutUs/Betfair ... /#Premium2

[ija34]

Just seen that my total charges are 31.72% of my gross profits too so won't pay until they are less than 20%

[ShaunWhite]

Betfair are basically stealing most of it.

I can't think of another profession with lower overheads and less tax.

I used to lose 50%.of my PAYE wages in taxes, pay a fortune for a train ticket and was out of the house 12hrs a day. I'll get stick for not joining the baying mob but this job is a breeze compared to trying to earn the same amount in a "normal" job and I think people forgot that.

[MaxLiability]

If it was such a breeze we'd have millions on here earning a wage, Shaun, plus you would not pay 50% of your PAYE, you'd pay 50% on a portion in the higher band not the 60% Betfair charge some, albeit I've yet to know anyone being charged 60%.

[ija34]

Betfair are basically stealing most of it.

I can't think of another profession with lower overheads and less tax.

I used to lose 50%.of my PAYE wages in taxes, pay a fortune for a train ticket and was out of the house 12hrs a day. I'll get stick for not joining the baying mob but this job is a breeze compared to trying to earn the same amount in a "normal" job and I think people forgot that.

Well if you are lucky enough to be in the higher tax threshold or even if you're on the lower one. Tax doesn't take the full percentage of your wage, you have a tax free income and only pay 20-45% on income above that threshold. Betfair are taking a cut of your total earnings. My original goal was to make £100,000 a year after tax but now I know about premium charge that seems impossible. Being on the 40%-60% charge, I'd have to make between £166,000 and £250,000 with between £66,000 and £150,000 going to Betfair.

[staker72]

I believe the40/60 only cuts in once you make 250K and I believe that's only in certain circumstances, sounds like a nice problem to have

[ija34]

I believe the40/60 only cuts in once you make 250K and I believe that's only in certain circumstances, sounds like a nice problem to have

Think about it though, if you got off to a flying start, earning £40k gross profits a year then in a little over 6 years the 40%-60% would kick in, so where you was paying £8,000 and coming out with £32k, you are now paying at least £16k and coming out with £24k. That's a massive step down in what you would be calling your salary as a full time trader, you would need to up your game massively to counter the extra charge which could result in you making mistakes and losing money. It makes it too difficult to plan long-term.

[ShaunWhite]

Well if you are lucky enough to be in the higher tax threshold

You don't get on the high rate through luck but I understand your argument. I'd just rather have a small slice of a lot than all of nothing, I don't have a viable alternative to Betfair so I have to accept their terms.

PC was something I was aware of from day one, so before trying to earn money I thought about how to generate commission, like a form of forward tax planning. The short story is that I generate about 35% a day and therefore don't pay any PC and due to pay very little PC2 soon. But it's not that I don't pay, i've just already paid it daily.

Someone who's extremely successful (nets 7 figures) once told me that if you don't like the net figure the answer is to earn more. Tbh there isn't another option. Gambling is much like any other profession, if you want to net 100 grand then it's difficult and only a very small percantage get there. I think your original 100k net goal was ambitious, I would think most full time manual traders would be on half of that.