webwiz
Posts: 1,133
Likes: 210
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Post by webwiz on Jul 24, 2015 21:25:17 GMT
I invest on several platforms and Archover is the only one to deduct income tax. Previously this did not bother me as the tax needed to be paid sometime. However following the budget I understand that the first tranche of interest will be tax free, so I would prefer if they stopped deducting tax at source and naturally informed HMRC amounts paid.
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Post by hugoarchover on Jul 27, 2015 12:45:25 GMT
Hi webwizThanks for raising the tax allowance question. The first £1,000 of peer-to-peer earnings will be tax-free from April 2016, the Treasury has confirmed, with the limit capped at £500 for higher rate taxpayers and not available to top rate taxpayers. However, if a peer-to-peer lender also earns interest at their bank or building society, this will also count as part of the allowance. As no P2P platform is party to your savings portfolio the onus is on you to send an annual statement to HMRC declaring that your peer-to-peer earnings are part of your personal savings allowance. The tax law clearly states that companies paying interest to individuals must withhold tax at basic rate and pay that direct to HMRC via a CT61 return – we do not do this collection (you can find more details here ( www.archover.com/tax/) and PWC and Baker Tilly’s comments as well). I do hope that helps you but please contact us if you need any further help. Thank you Hugo |
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webwiz
Posts: 1,133
Likes: 210
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Post by webwiz on Jul 27, 2015 20:43:14 GMT
Yes, that's for next year, but also announced for this year: The government announced that from
April 2015, it is abolishing the 10% ‘starting-rate’
of tax for savings income and replacing it with a
new 0% rate, to provide further support for the lowest
earners.
It is also increasing the amount of savings income that
the new 0% rate applies to, from £2,880 to £5,000.
This means that anyone with a total income of less
than £15,500 will not pay any tax on their savings.This only applies to tax payers with small incomes (like me!) www.gov.uk/government/uploads/system/uploads/attachment_data/file/293747/Fact_sheet_template_-_10__tax_9.pdf |
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Post by hugoarchover on Jul 28, 2015 13:41:33 GMT
Hi webwizThanks for your point re: allowances. You are correct that additional government support was given this year for lower earning savers. However, whatever the UK Government introduces in terms of tax allowances we are not party to our savers personal tax records so would not know who should being paying tax and who should not be. Regardless, current UK tax law states very clearly that companies that borrow money from private individuals and pay interest to them must withhold tax at the current income tax basic rate (20%) – ArchOver does not collect this money the Borrower simple pays directly to HMRC. The individual can then claim this back at the end of the tax year – we provide you with a tax summary to assist you We know of only one other platform that makes its Borrowers comply with this UK Withholding Tax like ArchOver. We cannot comment on why other platforms are not ensuring their Borrowers are doing this though we are aware that HMRC is investigating this matter. Please contact us again if you need more help. We have instant support available on our site if you need it. Thank you Hugo |
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shimself
Member of DD Central
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Likes: 1,169
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Post by shimself on Aug 1, 2015 22:46:01 GMT
There was a big flap and discussion about this with Assetz.
They got word from HMRC to stop doing it
The particular problem for the borrower is that they now have to maintain detailed records for each of the 100odd lenders (1000odd?) often in amounts of pence. I don't know about your t&c but most companies don't claim the right to disclose my details to the borrower. The borrower would have to keep track of secondary market trades which have no impact on their operation. It's a bad idea; I suggest you phone assetz and ask them how and who got them out of this silly bind.
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