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Post by bracknellboy on Aug 25, 2023 17:14:43 GMT
Just received the following (as no doubt have all other AC investors):
"We are writing to you in order to make you aware of a possible discrepancy in the “Total funds in loans put into recoveries” sum in the “Loans in Recoveries” section of your Assetz Capital Tax Statement.
<blah blah blah excuses excuses>
We have identified and corrected a bug, that manifested in September 2020, causing the amount of capital placed into recoveries to be under reported.
If you have been using the Tax Statement “Loans in Recoveries” data, whilst taking advantage of “Capital Loss Relief” via your HMRC Tax return, then you may need to review your Assetz Capital Tax Statements for the Tax Years 2020/21, 2021/22 & 2022/23 and compare them with the returns you submitted.
If you don’t use “Capital Loss Relief” then this will not be relevant to you.
Please accept our apologies for any inconvenience caused.
Yours not humbly, the AC Team (this last line I made up)"
I've not gone and looked, yet. To me its probably immaterial, unless I get some major downstream recovery from e.g. Thincats shiny shoe con man loans. Nonetheless, others may have suffered a material loss as a result of these errors. But with 4 years available to amend tax returns, it would be worth those who are in AC and had to declare P2P profit in those years rechecking their numbers.
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Post by crabbyoldgit on Aug 25, 2023 17:49:00 GMT
Ah one of the few joys of the wife being poor enough to not be a tax payer ,never having to get involved with recovered funds and associated tax issues, just wish she was a super tax payer and I was her kept toy boy.  |
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Aug 25, 2023 22:50:29 GMT
Just received the following (as no doubt have all other AC investors): Nope, apparently we're not talking anymore ... might have asked too many difficult questions/corrected too many fudge ups ... so my emails to them disappear & now it seems I'm off the mailing list.
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Post by bracknellboy on Aug 26, 2023 5:49:54 GMT
FWIW, I've just checked the "new" statements for those tax years and it is giving me the same numbers as originally. However, by that point I had relatively small AC exposure so still worth others checking, but the issue may not be universal/too widespread.
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Post by davefoz on Aug 26, 2023 6:16:41 GMT
For me the discrepancies are in 20/21 with the published defaults being understated as a result I have paid too much tax.
Another potential claim heading their way.
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Post by bracknellboy on Aug 26, 2023 9:07:31 GMT
For me the discrepancies are in 20/21 with the published defaults being understated as a result I have paid too much tax. Another potential claim heading their way. You can go back 4 years in amending tax returns. But you have to do it by writing to them: Write to HMRC You must write to HMRC if you’ve missed the deadline to make changes or you need to make a change to another tax year. You’ll also need to write HMRC a letter to: claim overpayment relief report income you did not include in your tax return You can claim a refund up to 4 years after the end of the tax year it relates to. linkGiven that you can do this, I don't think you'll have any claim on AC, unless you want to make a claim for your time/inconvenience.
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Post by spacecabbage on Aug 26, 2023 11:23:05 GMT
I can also only see a difference for 20/21. It's only about £3 so I won't be adjusting any tax returns.
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Aug 26, 2023 12:04:43 GMT
I would suspect that AC would need to inform HMRC of the revised figures as they are required to report aggregate income which will include platform declared losses.
Note that there is no requirement for anyone not claiming sideways relief to complete SA as HMRC give the relief automatically
SAIM12120
From 6 April 2016 relief for irrecoverable P2P loans against income from P2P loans that are made through the same platform will be given automatically, that is without the need for the lender to make a claim in a tax return.
The amount of P2P interest that the Lender will be subject to tax on is:
the total amount of P2P interest that they receive through each platform, less
the principal of P2P loans made through the same platform that have become irrecoverable in the same tax year.
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pikestaff
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Post by pikestaff on Aug 26, 2023 14:37:10 GMT
I would suspect that AC would need to inform HMRC of the revised figures as they are required to report aggregate income which will include platform declared losses.... Doubtful. AC have always taken the view that claiming for "loans put into recoveries" is optional, therefore (I would think) not reportable by them. Be that as it may, I do not agree with the basis on which AC report these numbers. They include 100% of a loan when put into recovery, even if 100% recovery is expected. Claiming for a "loss" that is not expected to arise is nonsense. I adjust AC's figures so as to claim for expected losses only.
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Aug 26, 2023 14:57:16 GMT
I would suspect that AC would need to inform HMRC of the revised figures as they are required to report aggregate income which will include platform declared losses.... Doubtful. AC have always taken the view that claiming for "loans put into recoveries" is optional, therefore (I would think) not reportable by them. Be that as it may, I do not agree with the basis on which AC report these numbers. They include 100% of a loan when put into recovery, even if 100% recovery is expected. Claiming for a "loss" that is not expected to arise is nonsense. I adjust AC's figures so as to claim for expected losses only. But that's the way HMRC have set it up. If a platform declares the loss then the platform is required under normal HMRC reporting rules to report a tax payers net income. Don't think there is any mechanism to declare a partial loss because once the loan is legal recovery then no guarantee anything will be recovered (see the MT ticktock loan for example, AC windmills) ... yes it's probable that something will be recovered but that's on the assumption the security is actually enforceable (see various FS loans)
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markb
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Post by markb on Aug 27, 2023 9:36:50 GMT
Doubtful. AC have always taken the view that claiming for "loans put into recoveries" is optional, therefore (I would think) not reportable by them. But that's the way HMRC have set it up. If a platform declares the loss then the platform is required under normal HMRC reporting rules to report a tax payers net income. I agree with pikestaff. Platforms don't deduct amounts put into recovery when they report a taxpayer's income to HMRC - as I discovered several years ago, when HMRC initiated a compliance check against me, due to the apparent mismatch between my tax return and the platforms' reports. I don't have up-to-date info though, so possibly HMRC have imposed a change, due to them getting fed-up of having to deal with all of the legitimate mismatches. I assume that platforms don't deduct written-off amounts either - because if the taxpayer had already chosen to deduct at the time of it entering recovery, the result would be to deduct it twice.
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Post by bracknellboy on Aug 27, 2023 10:19:41 GMT
But that's the way HMRC have set it up. If a platform declares the loss then the platform is required under normal HMRC reporting rules to report a tax payers net income. I agree with pikestaff. Platforms don't deduct amounts put into recovery when they report a taxpayer's income to HMRC - as I discovered several years ago, when HMRC initiated a compliance check against me, due to the apparent mismatch between my tax return and the platforms' reports. I don't have up-to-date info though, so possibly HMRC have imposed a change, due to them getting fed-up of having to deal with all of the legitimate mismatches. I assume that platforms don't deduct written-off amounts either - because if the taxpayer had already chosen to deduct at the time of it entering recovery, the result would be to deduct it twice. This was also my experience when HMRC queried my return and reflected back to me the reported 'savings income' I had. A major part (but not all) of the discrepancy on what they thought I should have reported vs what I did was gross P2P income from a couple of platforms, rather than net. (There was also a noteworthy discrepancy arising from a cash savings account I had overlooked, but that was not the large part).
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rscal
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Post by rscal on Aug 27, 2023 11:18:50 GMT
One thing I did not understand before relates to discounted loans in the SM. The statement note reads:
Because when I go through their in-recovery/recovered totals across all the years I've been with them and compare this net (negative) figure to my in default loans totals it is roughly half what I see. This could be accounted for by the discounts however. My discounts need to be included to reduce the amounts put into recovery [If that makes sense]
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ilmoro
Member of DD Central
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Post by ilmoro on Aug 27, 2023 16:45:54 GMT
Fair enough, it would seem that the guidance/manual doesn't reflect the reality. Not surprising.
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pikestaff
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Post by pikestaff on Aug 28, 2023 7:29:06 GMT
But that's the way HMRC have set it up. If a platform declares the loss then the platform is required under normal HMRC reporting rules to report a tax payers net income. I agree with pikestaff. Platforms don't deduct amounts put into recovery when they report a taxpayer's income to HMRC - as I discovered several years ago, when HMRC initiated a compliance check against me, due to the apparent mismatch between my tax return and the platforms' reports. I don't have up-to-date info though, so possibly HMRC have imposed a change, due to them getting fed-up of having to deal with all of the legitimate mismatches. I assume that platforms don't deduct written-off amounts either - because if the taxpayer had already chosen to deduct at the time of it entering recovery, the result would be to deduct it twice. I think that, on AC's view, the amounts put into recovery are not declared losses but amounts that taxpayers may optionally treat as losses. Hence they are excluded from their report to HMRC. To be consistent with this, I expect that when AC eventually get round to writing loans off they will deduct the write offs in their calculation of net income. I think they would have to.
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