mjc
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Post by mjc on Dec 21, 2018 9:18:25 GMT
That’s really great! Made my Christmas, thanks ilmoro.
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littleoldlady
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Running down all platforms due to age
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Post by littleoldlady on Dec 21, 2018 11:08:57 GMT
I only have funds in my ISA. Most of it did not qualify for this one, just a bit of interest I suppose, so I now have pennies in my standard account which I will either abandon or more likely transfer to my bank in order to vent my frustration. I can't add it to the ISA myself as it will count as a contribution over the limit, but AC could have done as it would have counted as interest.
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Post by bobthebuilder on Dec 23, 2018 5:23:39 GMT
Seems an excellent promotion, having just made 3.5k, but wondering about the tax treatment? About 1/2 from ISA, other standard, in a 30d. If it was interest the ISA proportion would be tax free, but as a bonus paid into the standard account, will this be CGT or an income tax liability for 100% of it? On a courtesy call from AC I raised this, and was ‘sold’ it being paid into the standard account as a ‘benefit’ as it “didn’t affect my current years ISA allowance”. D’oh, already utilized! It's a platform incentive so isn't taxable. An incentive isn't usually eligible for an ISA so has to be paid into a standard account.
ilmoro Do you have any source information to support your belief that this incentive isn't taxable? I'm comfortable with not including a joining bonus of £150 I received from AC in 2016/17 in my taxable income because (subject to a minimum investment of £2000) it wasn't related to the size of my investment and therefore couldn't be regarded as interest, even though AC included it in their income statement for the tax year and stated that it "should be supplied as income when you submit your tax return". By the same argument I won't be declaring the Growth Street bonus I am due on the recent Winter 2018 promotion, where you qualified for a £50 bonus on additional investments between £2500 and £4999.99. Since the bonus is a fixed amount within that range, the return varies between 2% and fractionally over 1% and as the return is variable it cannot be regarded as interest in my view. With the AC promotion however, the bonus is directly proportional to the additional amount invested so has all the characteristics of an interest payment. Can you explain why you think it should not be treated in that way?
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nick
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Post by nick on Dec 28, 2018 17:14:10 GMT
It's a platform incentive so isn't taxable. An incentive isn't usually eligible for an ISA so has to be paid into a standard account.
ilmoro Do you have any source information to support your belief that this incentive isn't taxable? I'm comfortable with not including a joining bonus of £150 I received from AC in 2016/17 in my taxable income because (subject to a minimum investment of £2000) it wasn't related to the size of my investment and therefore couldn't be regarded as interest, even though AC included it in their income statement for the tax year and stated that it "should be supplied as income when you submit your tax return". By the same argument I won't be declaring the Growth Street bonus I am due on the recent Winter 2018 promotion, where you qualified for a £50 bonus on additional investments between £2500 and £4999.99. Since the bonus is a fixed amount within that range, the return varies between 2% and fractionally over 1% and as the return is variable it cannot be regarded as interest in my view. With the AC promotion however, the bonus is directly proportional to the additional amount invested so has all the characteristics of an interest payment. Can you explain why you think it should not be treated in that way? The key characteristic of interest is that it is a payment by a borrower for the right of use of funds. In this case, it is arguable that the bonus is not being paid by a borrower for use of funds, but by the platform as incentive to lend on their platform (from which they benefit independently to the borrower) which is fundamentally different in nature to interest. If the bonus was being passed on directly as a cost on the borrower then the position would be a lot more grey. In worth noting that while interest is typically paid periodically based on a some percentage of principal, this is not a defining characteristic. For example, the discount on of zero coupon bonds is deemed interest on redemption with the difference between issue price and redemption being considered the 'price' paid by the issuer for use of funds.
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Post by chris on Jan 1, 2019 10:14:39 GMT
I only have funds in my ISA. Most of it did not qualify for this one, just a bit of interest I suppose, so I now have pennies in my standard account which I will either abandon or more likely transfer to my bank in order to vent my frustration. I can't add it to the ISA myself as it will count as a contribution over the limit, but AC could have done as it would have counted as interest. It isn't interest, so we couldn't have paid it like that.
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littleoldlady
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Running down all platforms due to age
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Post by littleoldlady on Jan 1, 2019 17:36:13 GMT
I only have funds in my ISA. Most of it did not qualify for this one, just a bit of interest I suppose, so I now have pennies in my standard account which I will either abandon or more likely transfer to my bank in order to vent my frustration. I can't add it to the ISA myself as it will count as a contribution over the limit, but AC could have done as it would have counted as interest. It isn't interest, so we couldn't have paid it like that. I will try to remember to put it into my ISA after April 6th - and also to deduct it from whoever gets most of my £20k.
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IFISAcava
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Post by IFISAcava on Jan 1, 2019 17:39:07 GMT
It isn't interest, so we couldn't have paid it like that. I will try to remember to put it into my ISA after April 6th - and also to deduct it from whoever gets most of my £20k. Careful - you can only subscribe to one IFISA with that £20,000
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littleoldlady
Member of DD Central
Running down all platforms due to age
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Post by littleoldlady on Jan 1, 2019 20:51:46 GMT
I will try to remember to put it into my ISA after April 6th - and also to deduct it from whoever gets most of my £20k. Careful - you can only subscribe to one IFISA with that £20,000 Duh! Well it is the day after New Year's Eve. Unless I decide to put £19,999+ into another type of ISA.
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mjc
Member of DD Central
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Post by mjc on Jan 2, 2019 9:27:16 GMT
ilmoro Do you have any source information to support your belief that this incentive isn't taxable? I'm comfortable with not including a joining bonus of £150 I received from AC in 2016/17 in my taxable income because (subject to a minimum investment of £2000) it wasn't related to the size of my investment and therefore couldn't be regarded as interest, even though AC included it in their income statement for the tax year and stated that it "should be supplied as income when you submit your tax return". By the same argument I won't be declaring the Growth Street bonus I am due on the recent Winter 2018 promotion, where you qualified for a £50 bonus on additional investments between £2500 and £4999.99. Since the bonus is a fixed amount within that range, the return varies between 2% and fractionally over 1% and as the return is variable it cannot be regarded as interest in my view. With the AC promotion however, the bonus is directly proportional to the additional amount invested so has all the characteristics of an interest payment. Can you explain why you think it should not be treated in that way? The key characteristic of interest is that it is a payment by a borrower for the right of use of funds. In this case, it is arguable that the bonus is not being paid by a borrower for use of funds, but by the platform as incentive to lend on their platform (from which they benefit independently to the borrower) which is fundamentally different in nature to interest. If the bonus was being passed on directly as a cost on the borrower then the position would be a lot more grey. In worth noting that while interest is typically paid periodically based on a some percentage of principal, this is not a defining characteristic. For example, the discount on of zero coupon bonds is deemed interest on redemption with the difference between issue price and redemption being considered the 'price' paid by the issuer for use of funds. #chris can you confirm ilmoro’s helpful observation as there seems to be some lingering doubt, please.
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blender
Member of DD Central
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Post by blender on Jan 2, 2019 10:30:40 GMT
The key characteristic of interest is that it is a payment by a borrower for the right of use of funds. In this case, it is arguable that the bonus is not being paid by a borrower for use of funds, but by the platform as incentive to lend on their platform (from which they benefit independently to the borrower) which is fundamentally different in nature to interest. If the bonus was being passed on directly as a cost on the borrower then the position would be a lot more grey. In worth noting that while interest is typically paid periodically based on a some percentage of principal, this is not a defining characteristic. For example, the discount on of zero coupon bonds is deemed interest on redemption with the difference between issue price and redemption being considered the 'price' paid by the issuer for use of funds. #chris can you confirm ilmoro’s helpful observation as there seems to be some lingering doubt, please. While not a tax expert, I agree with Nick. We do not lend money to p2p platforms, and so whatever the platform pays us is not interest, because there is no loan agreement between us. The method of calculation and periodicity of the payments does not matter, imo. If it did, then I would owe a lot for past 1% and 2% cashback payments from FC on amounts lent on particular loans, and for instant returns on Ablrate which are paid by Ablrate for deposits made against loans between listing and drawdown, at a daily rate equal to the putative interest rate. In this case, if it walks like a duck and quacks like a duck, it is not a duck for purposes of income tax, aiui.
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mjc
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Post by mjc on Jan 2, 2019 12:52:54 GMT
Thanks, I do want to believe nick and ilmoro, and think/hope this is right, but as I was new to AC and thus I could invest a substantial sum in the extended bonus offer period, I would like confirmation from the platform before I just possibly fall foul of hmrc. It affects many people.
How do I link to a person? I used hash Chris, but seems this was not right. ie #chris
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lara
Posts: 345
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Post by lara on Jan 2, 2019 13:10:56 GMT
Use @.
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Post by chris on Jan 2, 2019 13:19:36 GMT
Thanks, I do want to believe nick and ilmoro, and think/hope this is right, but as I was new to AC and thus I could invest a substantial sum in the extended bonus offer period, I would like confirmation from the platform before I just possibly fall foul of hmrc. It affects many people. How do I link to a person? I used hash Chris, but seems this was not right. ie #chris I am not qualified to provide tax advice, nor does AC have regulatory permission to do so. So unfortunately I cannot comment. All I can say is that we took advice from suitably qualified and authorised experts who agreed the wording on our tax statement and the methodology behind the figures, and that lenders should seek their own independent advice if they don't fully understand the situation themselves. Sorry I can't be of more help.
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rscal
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Post by rscal on Jun 19, 2019 15:13:22 GMT
Second 1% has just been paid! (one day early)
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Post by Harland Kearney on Jun 19, 2019 16:11:46 GMT
Yeah have it in my cash account, great!
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