The answer is both yes and no I'm afraid. From a legal standpoint the answer is most definitely yes, spread betting is considered gambling under UK law and as such is not subject to capital gains or income tax. However from a practical standpoint the answer is very much no, there is no real difference between buying shares through a broker (investing) or buying them through a spread bet provider. The method may be slightly different and you may be using leverage , but practically it is the same. The reasoning behind this difference is most spread bettors tend to be retail clients who lose and therefore to prevent this money being offset against gains in other areas the government classes it as gambling.