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Post by explorep2p on Aug 15, 2017 23:54:07 GMT
Hello Forum There's a lot of (fantastic) debate here about how to maximise P2P returns, but not so much about how to maximise post-tax returns. None of these tax reduction techniques are in any way new, and have been discussed previously. However we thought it may be useful to list them together in one place, and then run some numbers on just how big the tax savings could be over time. As you will see the savings can be very large, particularly if you are approaching retirement or are a higher rate tax payer..... We all hate taxes, here are some ways to cut them |
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pickles
Member of DD Central
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Post by pickles on Aug 18, 2017 17:03:20 GMT
Unless things have changed massively in the last year or so, your third option is a complete non-starter. Standard corporation tax would not apply for such a company, for exactly that reason.
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stevio
Member of DD Central
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Post by stevio on Aug 18, 2017 18:32:10 GMT
Hello Forum There's a lot of (fantastic) debate here about how to maximise P2P returns, but not so much about how to maximise post-tax returns. None of these tax reduction techniques are in any way new, and have been discussed previously. However we thought it may be useful to list them together in one place, and then run some numbers on just how big the tax savings could be over time. As you will see the savings can be very large, particularly if you are approaching retirement or are a higher rate tax payer..... We all hate taxes, here are some ways to cut themMost of your posts seem to just use this higher profile forum to drive traffic to your site
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james21
Member of DD Central
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Post by james21 on Aug 18, 2017 18:41:28 GMT
Bit basic that link; we are not school children, we all know what taxes apply and pay them when applicable according to the law
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Post by explorep2p on Aug 18, 2017 19:28:49 GMT
Even if the 19% corp tax rate did apply, higher rate tax payers would have to pay an additional 32.5% income tax on dividend distributions after the first £5k (£2k next year) making it worse than investing directly. Plus performing a corp tax return and submitting annual account is very non-trivial and likely to make make you old before your time. Not saying using a corp wouldn't be good for some people in certain situations (like people who have already got one) but it's not something to be regarded in the same breath as the other two far more trivial options. Agreed. Using a company probably won't make any sense if an investor needs access to the interest income through dividends, unless they keep those dividends below £5k pa. The main benefits are for investors who are near to retirement (deferring income until they are subject to lower marginal taxes), and for those who are happy to reinvest the interest income for several years. There are also the annual costs and admin hassles of filing the various returns. The amounts involved need to be sufficient to make it worthwhile to deal with these. In a lot of cases it won't be worthwhile, but once the invested amounts get large enough, it could be worth looking at.
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Post by elephantrosie on Aug 18, 2017 22:57:29 GMT
i wanted to open a limited company for my p2p investment but my accountant said ltd company that operates p2p investment as lender has to obtained FCA regulation.
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SteveT
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Post by SteveT on Aug 19, 2017 4:20:25 GMT
i wanted to open a limited company for my p2p investment but my accountant said ltd company that operates p2p investment as lender has to obtained FCA regulation. I suggest you get a new accountant.
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Post by elephantrosie on Aug 19, 2017 8:43:34 GMT
anyone has experience with using a ltd company for its p2p investment?
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SteveT
Member of DD Central
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Post by SteveT on Aug 19, 2017 8:57:09 GMT
anyone has experience with using a ltd company for its p2p investment? Yes, a fair few on here (me included). This thread may help as a start. Edit: on review, I see you yourself posted in it back in May !
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