archie
Posts: 1,839
Likes: 1,842
|
Post by archie on Apr 10, 2018 17:09:37 GMT
My MT 'new defaults' figure is higher than the interest across my 4 P2P platforms in 17-18. I'm assuming I can offset it all and so pay no tax - any differing views? If you wish. If you claim the defaults you also have to declare the recoveries which might push you into a higher tax bracket this year. It's all depends on your personal tax position as to what's best. If in doubt take advice. Personally I'll probably offset some loans but not all.
|
|
averageguy
Member of DD Central
Posts: 1,167
Likes: 841
|
Post by averageguy on Apr 10, 2018 17:19:14 GMT
My MT 'new defaults' figure is higher than the interest across my 4 P2P platforms in 17-18. I'm assuming I can offset it all and so pay no tax - any differing views? If you wish. If you claim the defaults you also have to declare the recoveries which might push you into a higher tax bracket this year. It's all depends on your personal tax position as to what's best. If in doubt take advice. Personally I'll probably offset some loans but not all. Likewise....hedge ones bets
|
|
|
Post by eascogo on Apr 10, 2018 17:46:19 GMT
My MT 'new defaults' figure is higher than the interest across my 4 P2P platforms in 17-18. I'm assuming I can offset it all and so pay no tax - any differing views? Because MT chose to report all their defauts in their tax statements I guess there are quite a few lenders in a similar position as yours. This also applies to me and I will declare that portion of P2P losses so to pay no tax this year. Losses in excess of that can then be offset over the next few years. I tend to declare revenue to HMRC later in the year but I would feel lucky if recoveries were anywhere close to my total P2P interest anytime soon.
|
|
k6
Posts: 178
Likes: 110
|
Post by k6 on Apr 13, 2018 21:14:28 GMT
My MT 'new defaults' figure is higher than the interest across my 4 P2P platforms in 17-18. I'm assuming I can offset it all and so pay no tax - any differing views? Because MT chose to report all their defauts in their tax statements I guess there are quite a few lenders in a similar position as yours. This also applies to me and I will declare that portion of P2P losses so to pay no tax this year. Losses in excess of that can then be offset over the next few years. I tend to declare revenue to HMRC later in the year but I would feel lucky if recoveries were anywhere close to my total P2P interest anytime soon. Am I right in pointing out that we can only offset losses from interest earned through FCA regulated platforms ?
|
|
|
Post by eascogo on Apr 13, 2018 23:10:06 GMT
Because MT chose to report all their defauts in their tax statements I guess there are quite a few lenders in a similar position as yours. This also applies to me and I will declare that portion of P2P losses so to pay no tax this year. Losses in excess of that can then be offset over the next few years. I tend to declare revenue to HMRC later in the year but I would feel lucky if recoveries were anywhere close to my total P2P interest anytime soon. Am I right in pointing out that we can only offset losses from interest earned through FCA regulated platforms ? Only P2P losses can be offset against interest earned. As far as I know P2P platforms are all FCA regulated, COL being an exception that was found to operate without FCA permission.
|
|
mason
Member of DD Central
Posts: 662
Likes: 640
|
Post by mason on Apr 14, 2018 6:29:44 GMT
Am I right in pointing out that we can only offset losses from interest earned through FCA regulated platforms ? Only P2P losses can be offset against interest earned. As far as I know P2P platforms are all FCA regulated, COL being an exception that was found to operate without FCA permission. I believe Bond Mason is an example of a P2P platform operating legitimately that isn't regulated.
|
|
pikestaff
Member of DD Central
Posts: 2,140
Likes: 1,486
Member is Online
|
Post by pikestaff on Apr 14, 2018 7:27:31 GMT
Whether it is right to claim losses on defaulted loans as soon as they default depends on your interpretation of the legislation. In my view it is right only where there will be no further recovery from the primary security. See this post for why: p2pindependentforum.com/post/218979/thread. Although I'm not on MT, I'm pretty sure that this would rule out claiming losses on most if not all MT loans at this stage. Whatever view you take on the matter you should be consistent within the year and from year to year. You cannot pick and choose. Depending on your tax position, the biggest risk in claiming early on loans where there is likely to be a recovery is that you will end up deducting losses at 20% (or even 0% if you have too many) but paying tax on the recoveries at 40% or more.
|
|
mouse
Posts: 55
Likes: 29
|
Post by mouse on Apr 14, 2018 7:41:42 GMT
Only P2P losses can be offset against interest earned. As far as I know P2P platforms are all FCA regulated, COL being an exception that was found to operate without FCA permission. I believe Bond Mason is an example of a P2P platform operating legitimately that isn't regulated. The chief of BC posted last week p2pindependentforum.com/post/259023/threadI am no expert, but BC also seems to operate legitimately but without the need or requirement to be FCA regulated for self select p2p loans. Or am i missing something
|
|
pikestaff
Member of DD Central
Posts: 2,140
Likes: 1,486
Member is Online
|
Post by pikestaff on Apr 14, 2018 7:42:42 GMT
Am I right in pointing out that we can only offset losses from interest earned through FCA regulated platforms ? It's actually slightly narrower than that. 412J (2)(a) “Operator” means a person who— (a) has permission under Part 4A of FISMA 2000 to carry on a regulated activity specified in Article 36H of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544) (operating an electronic system in relation to lending), or (b) has been granted equivalent permission under the law of a territory outside the United Kingdom that is within the European Economic Area.Permission includes interim permissions, before anyone asks. Regular p2p lenders operating lawfully in the UK have Article 36H permission. We now know that Collateral did not, so lenders cannot claim for losses on Collateral. I cannot comment on the position of overseas platforms, nor do I know which (if any) UK platforms operating with a different permission from the usual for p2p are within Article 36H. You'd need to ask the platforms yourself, if the answer is not already on here or on their website. Edit: It is clear from the linked post on behalf of BC, in the post above, that BC do not (at present) have Article 36H permisson. Therefore any losses on BC are not (at present) tax deductible.
|
|
mouse
Posts: 55
Likes: 29
|
Post by mouse on Apr 20, 2018 10:22:12 GMT
I believe Bond Mason is an example of a P2P platform operating legitimately that isn't regulated. The chief of BC posted last week p2pindependentforum.com/post/259023/threadI am no expert, but BC also seems to operate legitimately but without the need or requirement to be FCA regulated for self select p2p loans. Or am i missing something So if platforms such as BM and BC are not FCA regulated, does anyone know what legal requirements they must satisfy in order to operate legitimately ?
|
|
jlend
Member of DD Central
Posts: 1,817
Likes: 1,444
|
Post by jlend on Apr 23, 2018 15:45:26 GMT
Whether it is right to claim losses on defaulted loans as soon as they default depends on your interpretation of the legislation. In my view it is right only where there will be no further recovery from the primary security. See this post for why: p2pindependentforum.com/post/218979/thread. Although I'm not on MT, I'm pretty sure that this would rule out claiming losses on most if not all MT loans at this stage. Whatever view you take on the matter you should be consistent within the year and from year to year. You cannot pick and choose. Depending on your tax position, the biggest risk in claiming early on loans where there is likely to be a recovery is that you will end up deducting losses at 20% (or even 0% if you have too many) but paying tax on the recoveries at 40% or more. One option to potentially clear up the abiguity is for MT to get HMRC and the FCA to sign off on the tax statements. RS and AC have indicated they will do this.
|
|
pikestaff
Member of DD Central
Posts: 2,140
Likes: 1,486
Member is Online
|
Post by pikestaff on Apr 23, 2018 17:37:32 GMT
Whether it is right to claim losses on defaulted loans as soon as they default depends on your interpretation of the legislation. In my view it is right only where there will be no further recovery from the primary security. See this post for why: p2pindependentforum.com/post/218979/thread. Although I'm not on MT, I'm pretty sure that this would rule out claiming losses on most if not all MT loans at this stage. Whatever view you take on the matter you should be consistent within the year and from year to year. You cannot pick and choose. Depending on your tax position, the biggest risk in claiming early on loans where there is likely to be a recovery is that you will end up deducting losses at 20% (or even 0% if you have too many) but paying tax on the recoveries at 40% or more. One option to potentially clear up the abiguity is for MT to get HMRC and the FCA to sign off on the tax statements. RS and AC have indicated they will do this. Not sure what "sign off" means. In the case of RS it probably means a sign off on the treatment of provision funds, and my impression (which may be mistaken) is that that's also what AC will be looking to confirm. My impression is that nobody including HMRC has really got to grips with the timing of loss claims, and the last thing I want is some local inspector saying something unhelpful which everybody then takes as gospel.
|
|
niceguy37
Member of DD Central
Posts: 504
Likes: 254
|
Post by niceguy37 on Jul 9, 2018 14:59:25 GMT
My MT 'new defaults' figure is higher than the interest across my 4 P2P platforms in 17-18. I'm assuming I can offset it all and so pay no tax - any differing views? Because MT chose to report all their defauts in their tax statements I guess there are quite a few lenders in a similar position as yours. This also applies to me and I will declare that portion of P2P losses so to pay no tax this year. Losses in excess of that can then be offset over the next few years. I tend to declare revenue to HMRC later in the year but I would feel lucky if recoveries were anywhere close to my total P2P interest anytime soon. My P2P losses are greater than my earnings this year, totalling across several P2P platforms. So I'll be hoping to carry the excess loss forward to offset against interest next year. What would be really good is if I could offset it against the previous year (when I actually earned the bulk of the interest from these less successful loans). I suspect that next year Lendy may finally be declaring some of their loans "irrecoverable for tax purposes", and that will again leave me will an excess of losses over interest.
|
|
archie
Posts: 1,839
Likes: 1,842
|
Post by archie on Jul 9, 2018 15:33:55 GMT
Note : A possible situation that occurs to me.
If you made a donation with Gift Aid during the last tax year you would need to declare sufficient income to cover it wouldn't you?
|
|
|
Post by eascogo on Jul 9, 2018 23:49:50 GMT
Because MT chose to report all their defauts in their tax statements I guess there are quite a few lenders in a similar position as yours. This also applies to me and I will declare that portion of P2P losses so to pay no tax this year. Losses in excess of that can then be offset over the next few years. I tend to declare revenue to HMRC later in the year but I would feel lucky if recoveries were anywhere close to my total P2P interest anytime soon. My P2P losses are greater than my earnings this year, totalling across several P2P platforms. So I'll be hoping to carry the excess loss forward to offset against interest next year. What would be really good is if I could offset it against the previous year (when I actually earned the bulk of the interest from these less successful loans). I suspect that next year Lendy may finally be declaring some of their loans "irrecoverable for tax purposes", and that will again leave me will an excess of losses over interest. niceguy37. I believe you cannot offset P2P losses against P2P interest earned in previous years. Losses can be offset for a maximum of 4 years. The relevant HMRC guidance says: "If carried forward, relief for the outstanding amount of the irrecoverable loan must be used against P2P interest received in the earliest year first, up to a maximum of 4 years." [ www.gov.uk/government/publications/income-tax-relief-for-irrecoverable-peer-to-peer-loans-final-guidance] One would hope that such disastrous results do not continue year after year.
|
|