debaura
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Aug 11, 2018 15:39:39 GMT
Post by debaura on Aug 11, 2018 15:39:39 GMT
The tax statements produced by MT etc are gross aren't they? Also does anyone know where to write in bad debt relief on a self- assessment form? Muchus Gratias.
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ilmoro
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Aug 11, 2018 16:27:25 GMT
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Post by ilmoro on Aug 11, 2018 16:27:25 GMT
The tax statements produced by MT etc are gross aren't they? Also does anyone know where to write in bad debt relief on a self- assessment form? Muchus Gratias. Yes, interest before tax. You don't actually write it on the form, you deduct it from P2P interest and write the net sum. So basically interest - losses + recoveries is the amount you write in. It goes under other income not savings interest.
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Greenwood2
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Post by Greenwood2 on Aug 11, 2018 17:43:24 GMT
You might want to mention what you deducted as irrecoverable (bad debt, etc) in the comments as well.
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debaura
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Aug 11, 2018 17:59:05 GMT
Post by debaura on Aug 11, 2018 17:59:05 GMT
The tax statements produced by MT etc are gross aren't they? Also does anyone know where to write in bad debt relief on a self- assessment form? Muchus Gratias. Yes, interest before tax. You don't actually write it on the form, you deduct it from P2P interest and write the net sum. So basically interest - losses + recoveries is the amount you write in. It goes under other income not savings interest. Thank you both very much! ( I had it under savings income!) Another quandary! I am in 2 Thincats loans which will not repay. TC states that any interest already received should eventually be written against capital losses on these loans, ..........(which seems against gvt advice...). Further, as these losses have not been officially recognised, to write the interest already received in this year's tax submission, and then next year correct the tax return to show the same interest as a CGT loss against the main loss....?? ie. Tax year 2017 - 2018 to show interest of £200 Tax year 2018- 2019 to go back and correct the interest shown in 2017 of £200, and then set against the capital loss of £2000, to then show a loss of £1800.... Any thoughts please...  ?? Seems a tad....
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ilmoro
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Aug 11, 2018 18:50:01 GMT
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Post by ilmoro on Aug 11, 2018 18:50:01 GMT
Yes, interest before tax. You don't actually write it on the form, you deduct it from P2P interest and write the net sum. So basically interest - losses + recoveries is the amount you write in. It goes under other income not savings interest. Thank you both very much! ( I had it under savings income!) Another quandary! I am in 2 Thincats loans which will not repay. TC states that any interest already received should eventually be written against capital losses on these loans, ..........(which seems against gvt advice...). Further, as these losses have not been officially recognised, to write the interest already received in this year's tax submission, and then next year correct the tax return to show the same interest as a CGT loss against the main loss....?? ie. Tax year 2017 - 2018 to show interest of £200 Tax year 2018- 2019 to go back and correct the interest shown in 2017 of £200, and then set against the capital loss of £2000, to then show a loss of £1800.... Any thoughts please... ?? Seems a tad.... Sounds like they are talking about previous rules where losses were against CGT. Doesnt sound like they are applying current rules.
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debaura
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Aug 11, 2018 19:38:07 GMT
Post by debaura on Aug 11, 2018 19:38:07 GMT
OK thank you!
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debaura
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Aug 11, 2018 19:44:37 GMT
Post by debaura on Aug 11, 2018 19:44:37 GMT
Property Partner have sent a tax return for this year to include capital losses. Their income is rated taxable under dividends not interest as well. Is this an exception? Thanks.
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Greenwood2
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Aug 12, 2018 6:31:39 GMT
Post by Greenwood2 on Aug 12, 2018 6:31:39 GMT
Yes, interest before tax. You don't actually write it on the form, you deduct it from P2P interest and write the net sum. So basically interest - losses + recoveries is the amount you write in. It goes under other income not savings interest. Thank you both very much! ( I had it under savings income!) Another quandary! I am in 2 Thincats loans which will not repay. TC states that any interest already received should eventually be written against capital losses on these loans, ..........(which seems against gvt advice...). Further, as these losses have not been officially recognised, to write the interest already received in this year's tax submission, and then next year correct the tax return to show the same interest as a CGT loss against the main loss....?? ie. Tax year 2017 - 2018 to show interest of £200 Tax year 2018- 2019 to go back and correct the interest shown in 2017 of £200, and then set against the capital loss of £2000, to then show a loss of £1800.... Any thoughts please... ?? Seems a tad.... I declare TC losses exactly the same way as other platforms, ie, offset losses against interest earned. Is there a reason you want to use CGT? But if TC have not yet written them off you may want to wait until they do to claim them.
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debaura
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Aug 12, 2018 6:43:51 GMT
Post by debaura on Aug 12, 2018 6:43:51 GMT
Thank you both very much! ( I had it under savings income!) Another quandary! I am in 2 Thincats loans which will not repay. TC states that any interest already received should eventually be written against capital losses on these loans, ..........(which seems against gvt advice...). Further, as these losses have not been officially recognised, to write the interest already received in this year's tax submission, and then next year correct the tax return to show the same interest as a CGT loss against the main loss....?? ie. Tax year 2017 - 2018 to show interest of £200 Tax year 2018- 2019 to go back and correct the interest shown in 2017 of £200, and then set against the capital loss of £2000, to then show a loss of £1800.... Any thoughts please... ?? Seems a tad.... I declare TC losses exactly the same way as other platforms, ie, offset losses against interest earned. Is there a reason you want to use CGT? But if TC have not yet written them off you may want to wait until they do to claim them. Thanks, it is TC who have suggested that this is the proper way ie CGT, and also Property Partner has their year end tax statement written out specifically for CGT not interest.
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Greenwood2
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Post by Greenwood2 on Aug 12, 2018 7:02:26 GMT
My TC statement just gives a list of amounts that are irrecoverable principal (to date) from specific loans, and I declare the relevant amount for the tax year, no mention of CGT anywhere.
If it suits you I think you can still go the CGT route, but that is no use to most lenders.
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ilmoro
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Aug 12, 2018 8:21:20 GMT
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Post by ilmoro on Aug 12, 2018 8:21:20 GMT
debaura Property Partner isn't a P2P lending platform, it's a property crowdfunding platform where you are investing in shares in property SPV. Therefore it's taxation is totally different as you are receiving payments of rent from the properties in the form of dividends and any losses/gains are taxed under CGT rules. Basically same tax rules as stock market investments. It doesn't get entered with P2P interest. See the knowledge base, how works & glossary on the PP site. NB Not tax advice as I am not a financial professional.
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debaura
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Aug 12, 2018 8:25:04 GMT
Post by debaura on Aug 12, 2018 8:25:04 GMT
debaura Property Partner isn't a P2P lending platform, it's a property crowdfunding platform where you are investing in shares in property SPV. Therefore it's taxation is totally different as you are receiving payments of rent from the properties in the form of dividends and any losses/gains are taxed under CGT rules. Basically same tax rules as stock market investments. It doesn't get entered with P2P interest. See the knowledge base, how works & glossary on the PP site. NB Not tax advice as I am not a financial professional. Thank you Limoro, very kind of you to respond.
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hazellend
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Aug 12, 2018 9:07:29 GMT
Post by hazellend on Aug 12, 2018 9:07:29 GMT
Just looked at my tax return (already filed because I like to do it ASAP).
"Interest from UK banks, building societies and securities etc" - is the section where I filed P2P interest and just subtracted bad debt but didn't fill in any comments.
Property Partner dividends got lumped into the dividends section.
I suspect HMRC will probably start insisting I get an accountant to do my tax return soon, as it must be a fairly unusual one.
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ilmoro
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Post by ilmoro on Aug 12, 2018 10:51:50 GMT
Just looked at my tax return (already filed because I like to do it ASAP). "Interest from UK banks, building societies and securities etc" - is the section where I filed P2P interest and just subtracted bad debt but didn't fill in any comments. Property Partner dividends got lumped into the dividends section. I suspect HMRC will probably start insisting I get an accountant to do my tax return soon, as it must be a fairly unusual one. I doubt it makes any difference but for the record that technically isnt correct. P2P loan interest should be under other income in the section with gilts etc. See HMRC P2P guidance
How to claim tax relief in a tax return
Peer to peer interest should be entered on form SA101 Additional Information under Other UK income, Interest from gilt-edged and other UK securities, deeply discounted securities and accrued income profits.
When completing the SA101 form enter the:
box 3 - interest received gross less any bad debt relief from all platforms
box 1 - interest received net less any bad debt relief from all platforms
box 2 - full amount of tax deducted from the interest
Any excess relief for peer to peer bad debts available to carry forward does not need to be included on the tax return, but the lender should keep records of any carry forward relief in order to make a correct and complete claim in a tax return for a future period.
The Self Assessment Tax Returns Manual gives more detail about requirements for keeping records to complete tax returns.
Other UK income
Interest from gilt-edged and other
UK securities, deeply discounted securities
and accrued income profits
This includes disguised interest and interest from:
• government stocks, gilt-edged securities or gilts
• bonds, loan notes or similar securities issued by UK
companies, local authorities, or bodies in the UK
• peer-to-peer loans made using a UK platform
It doesn’t include interest you receive from an ISA
or PEP. Only put your share of any joint income
on the ‘Additional information’ pages.
Disguised interest is an interest-like amount you
receive that isn’t taxed in the same way as other
interest. It’ll only apply to financial arrangements
you enter into from 6 April 2017. Your tax adviser
will tell you the amount to include in box 3.
If you want to claim bad debt relief on a
peer-to-peer loan, deduct the bad debt from the
interest you receive, and put the interest figure
after this deduction in box 3.
Usual disclaimer about advice. I dont use non UK platforms so couldnt comment where that should be entered. Suspect mine is just a weird. Agree with PP dividends.
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hazellend
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Aug 12, 2018 14:08:49 GMT
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Post by hazellend on Aug 12, 2018 14:08:49 GMT
Thanks for the correction.
It doesn't seem to have made any difference to the tax payable (I am eligible for the full starting rate for savings. so paid no tax on p2p income last year as I was under 17k).
I might see if I can change it though.
To be honest, I dread having to talk to an accountant about things like this.
My experience is that you get better more knowledgable advice on online forums like this, for free and far less effort, than having to explain it to a professional.
I don't understand it when people say their accountant has saved them £££s. When you fill out a self assessment, the pounds that can be saved are automatically saved. I find it hard to believe an accountant could save you much money you wouldn't save yourself, with some basic knowledge about tax shelters and using lower earning spouses accounts for investments.
Obviously, you need to re-check everything yourself before going ahead with said advice.
I have also managed to save 1000s a year by not using a financial advisor. Bogleheads and monevator provide much better advice for free.
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