Is forex spread betting a bet or a CFD? It is a leveraged derivative: you stake money per point that a currency pair moves, and you never own the currency. It is sold by firms whose own footers state they are FCA-authorised. Both providers read here say most of their retail accounts lose money on spread bets and CFDs.
This is an evergreen explainer, not a news item and not trading advice. The figures below come from two providers’ own forex pages, which this desk read on 15 October 2026. Loss percentages and spreads on those pages change; each figure here is dated for that reason.
Is forex spread betting a CFD? What the providers’ pages say
A forex spread bet and a forex CFD reference the same currency price and are both traded on margin. They differ in how the position is sized, the currency profit and loss arrive in, and how each firm describes the tax.
| Read 15 Oct 2026 | Spreadex | IG |
|---|---|---|
| Retail-loss warning | 61% of retail investors lose money on spread bets and CFDs with this provider | 70% of retail investor accounts lose money on spread bets and CFDs with this provider |
| Published minimum major spread | EUR/USD from 0.6, GBP/USD from 0.9 points (variable) | Not stated on the page read |
| Spread bet sizing | £ stake per point, e.g. £10 per point | £ per point; “no restrictions” on deal size |
| Forex CFD sizing | Contracts worth $1 per point | Lots; standard lot 100,000 units of base currency |
| Tax wording | Spread bet profits “currently free of UK capital gains tax*” and stamp duty for UK residents | “Spread betting is also tax-free in the UK.” (footnote 1) |
| Tax footnote | “Tax laws are subject to change and depend on individual circumstances. Tax law may differ in a jurisdiction other than the UK.” | Identical wording |
| FCA line in footer | Spreadex Ltd authorised and regulated by the FCA | IG Markets Ltd (195355), IG Trading and Investments Ltd (944492), IG Index Ltd (114059) |
Sources: Spreadex’s forex page and IG’s forex spread betting guide. The FCA lines are what each firm’s own footer states; this desk did not check the FS Register for this piece, and readers should.
What is forex spread betting, mechanically?
You choose a stake per point. A point on GBP/USD is a move of 0.0001. IG’s worked example is £5 per point on a 20-point move: £100, before overnight charges. Spreadex’s example is £10 per point on GBP/USD at 1.2500, which it puts at £125,000 of exposure against a 3.33% margin of about £4,160. Profit and loss are calculated on the full exposure, not the deposit. That is the whole of the leverage argument, and Spreadex says it plainly. Neither firm’s example is a forecast; both are arithmetic.
Forex spread betting vs CFD: where they actually differ
Spreadex’s own comparison lists the practical differences. A spread bet’s profit or loss is always in pounds; a forex CFD’s accrues in the quote currency and is converted. A spread bet is sized as a stake per point; a CFD as a number of contracts. Spreadex says the same margin applies to both and that one account can hold both.
IG frames the difference as control over size. Its page says no restrictions exist on spread bet deal size, while forex CFDs must be traded in lots. Neither page, as read here, suggests one is cheaper than the other as a rule; costs depend on the market and the firm’s terms.
The tax treatment is where the firms draw the sharpest line. Spreadex says CFD profits may be liable to capital gains tax but CFD losses can usually be offset against other gains, and that spread bet losses cannot be offset. A favourable line on profits comes with no relief on losses.
Is forex spread betting tax free, or a tax dodge?
The providers’ wording is “currently free” (Spreadex) and “tax-free in the UK” (IG), each with the same footnote about change and individual circumstances. That is marketing copy with a hedge, not a ruling. HMRC’s own position, set out in its manuals, is covered in our post on whether you pay tax on spread betting: an individual who is not trading is not normally taxed on profits and gets no relief for losses, and whether someone is trading turns on the facts. “Tax dodge” overstates it. The treatment is HMRC’s published guidance, and it cuts both ways.
Is forex spread betting regulated in the UK?
The product is sold in the UK by firms that state, in their own footers, that they are authorised and regulated by the FCA, as the table shows. Both pages carry the retail-loss warning in the same form. The footer is the firm’s statement, not the regulator’s. Look the firm up on the FS Register before opening an account, and check that the entity on your agreement is the one listed. Our IG and Spreadex reviews set out which company does what.
Two forum claims, checked against the pages
The top result for this search is an undated forum thread. Two of its claims deserve a reply.
“Tax free because it is considered gambling.” Neither provider’s page, as read, calls the product gambling; both call it a leveraged derivative. The tax position comes from HMRC’s guidance on whether betting is a trade, not from any label the product carries.
“Spread betting doesn’t have a spread.” Spreadex’s worked example says the price you deal at includes the spread, from 0.9 points on GBP/USD. The cost is in the price, not on an invoice.
The questions readers ask
What is forex spread betting?
A leveraged derivative in which you stake an amount of money per point that a currency pair moves, and win or lose that stake for every point. You never own the currency. Spreadex and IG both describe it this way on their own forex pages, and both warn that most of their retail clients lose money on spread bets and CFDs.
Is spread betting tax free in the UK?
IG’s page says it is; Spreadex says profits are currently free of UK capital gains tax and stamp duty for UK residents. Both attach the same footnote: tax laws change and depend on individual circumstances. HMRC’s manuals reach a similar position for an individual who is not trading, with no relief for losses. That is tax information, not tax advice.
Is spread betting the same as CFD trading?
No, although both are leveraged derivatives on the same prices. A spread bet is sized in pounds per point. A forex CFD is sized in contracts or lots: one Spreadex contract is $1 per point, and an IG standard lot is 100,000 units of the base currency. Spreadex says CFD losses can usually be offset against capital gains; spread bet losses cannot.
Is spread betting gambling?
Neither provider’s page, read on 15 October 2026, calls it gambling. Both describe a leveraged derivative and carry a retail-loss warning. The forum claim that it is untaxed because it is gambling runs two things together: HMRC’s manuals start from the old case law that betting is not trading, but that is a tax test, not a description of the product.
The tax line is not the risk line
On the pages read, 61% of Spreadex’s and 70% of IG’s retail accounts lose money on spread bets and CFDs. Leverage applies to forex spread bets exactly as to CFDs; our note on leverage limits is the house reading on that subject. None of this is a recommendation to trade, and no part of it is advice.
Spread bets and CFDs risk substantial loss. Not financial advice. Check the Register.