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What are My Responsibilities if I Run an Unlicensed Forex Business?

What are my responsibilities if I run an unlicensed Forex business?

Open Forex Company

What are my responsibilities if I run an unlicensed Forex business? The responsibilities which any Forex trader, licensed or unlicensed, may have depends on a number of variables, including the source of the trading funds, the chain of responsibility and the terms of any relevant insurances. Like any other business, a Forex trader is also bound by the law where their business is incorporated, in particular as it relates to tax payment, financial reporting and incorporation. Licensing can sometimes bring an additional layer of bureaucracy, but not inevitably so. Discover below why being unlicensed can result in just as much paperwork as becoming a licensed trader.

Every business generates paperwork: even if you're not investing other people's money and don't see the need to become a licensed Forex trader, it's still necessary for your business to be legally registered in its country of operation. 

Insurance considerations: many traders protect themselves against unexpected loss through insurance. Almost inevitably a suitable policy will stipulate the necessity for appropriate records relating to transactions to be kept up to date. In addition, should the business be queried by a tax authority, it's important that accurate, up to date financial information is on hand to clarify what the tax position might be.

Business credentials: whilst many international traders may be fairly ambivalent about UK licensing, they may well want to see evidence that the company with whom they're about to do business with is fit for purpose. 

It becomes clear that even without a license there are still a number of different obligations which every trading organisation has to meet.