Greenwood2
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Post by Greenwood2 on Nov 21, 2022 18:13:24 GMT
Looks bad. Accounts say Qardus is 1 of 24 unsecured creditors, and are owed £61,808.69 of the total £1,345,153.46 deficiency. A total wipeout of outstanding capital on this loan would reduce my platform XIRR to 13.92% from its present 19.07%. Will more than wipe out my interest. Can this loss be offset against P2P interest?
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Post by Ace on Nov 21, 2022 18:19:02 GMT
Looks bad. Accounts say Qardus is 1 of 24 unsecured creditors, and are owed £61,808.69 of the total £1,345,153.46 deficiency. A total wipeout of outstanding capital on this loan would reduce my platform XIRR to 13.92% from its present 19.07%. Will more than wipe out my interest. Can this loss be offset against P2P interest? I believe so, but rules are complicated. There's a general thread about it here.
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Post by df on Nov 21, 2022 19:01:14 GMT
Looks bad. Accounts say Qardus is 1 of 24 unsecured creditors, and are owed £61,808.69 of the total £1,345,153.46 deficiency. A total wipeout of outstanding capital on this loan would reduce my platform XIRR to 13.92% from its present 19.07%. Will more than wipe out my interest. Can this loss be offset against P2P interest? The same here. If I write it off my current XIRR will be -4.82%. I hope I'm wrong, but I'm not hopeful for any significant recoveries. It wouldn't have so much impact on portfolio if the loan book wasn't so small.
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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 Nov 21, 2022 23:52:11 GMT
Looks bad. Accounts say Qardus is 1 of 24 unsecured creditors, and are owed £61,808.69 of the total £1,345,153.46 deficiency. A total wipeout of outstanding capital on this loan would reduce my platform XIRR to 13.92% from its present 19.07%. Will more than wipe out my interest. Can this loss be offset against P2P interest? Don't think so as Qardus doesn't hold the qualifying permission or appear to offer article 36h loans. It's equity crowdfunding.
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Post by Ace on Nov 22, 2022 8:57:14 GMT
Will more than wipe out my interest. Can this loss be offset against P2P interest? Don't think so as Qardus doesn't hold the qualifying permission or appear to offer article 36h loans. It's equity crowdfunding. I'm out of my depth here, but... is this not covered as being an authorised representative of Share In?
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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 Nov 22, 2022 9:37:54 GMT
Don't think so as Qardus doesn't hold the qualifying permission or appear to offer article 36h loans. It's equity crowdfunding. I'm out of my depth here, but... is this not covered as being an authorised representative of Share In? No, Sharein doesnt have the required permission, operating an electronic platform in relation to lending.
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Greenwood2
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Post by Greenwood2 on Nov 22, 2022 10:59:55 GMT
I'm out of my depth here, but... is this not covered as being an authorised representative of Share In? No, Sharein doesnt have the required permission, operating an electronic platform in relation to lending. Shouldn't someone have permission? Qardus says they do unsecured business loans.
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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 Nov 22, 2022 11:20:44 GMT
No, Sharein doesnt have the required permission, operating an electronic platform in relation to lending. Shouldn't someone have permission? Qardus says they do unsecured business loans. They have permissions (investment) just not the one that makes it eligible to offset losses against income from P2P. The structure is equity crowdfunding. You are investing in shares in an SPV that advances the loan to the SME via a commodity agreement.
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Post by Ace on Nov 22, 2022 11:49:24 GMT
Shouldn't someone have permission? Qardus says they do unsecured business loans. They have permissions (investment) just not the one that makes it eligible to offset losses against income from P2P. The structure is equity crowdfunding. You are investing in shares in an SPV that advances the loan to the SME via a commodity agreement. I was going to research this later, but I expect that you probably already know; can losses on Q be offset against profits from other loans on the same platform? Or is that also disallowed without 36H permission? Will be interesting to see what Q's tax statement says.
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Greenwood2
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Post by Greenwood2 on Nov 22, 2022 12:51:26 GMT
Shouldn't someone have permission? Qardus says they do unsecured business loans. They have permissions (investment) just not the one that makes it eligible to offset losses against income from P2P. The structure is equity crowdfunding. You are investing in shares in an SPV that advances the loan to the SME via a commodity agreement. But HMRC say that Sharia compliant 'lending' (although it is presented differently) should be treated for tax purposes like the western equivalent. If I have to declare the 'dividends' from the SPV as interest because it would be interest if not in a Sharia compliant wrapper it should also be subject to the offsetting ability. Or we lose out both ways.
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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 Nov 22, 2022 14:41:53 GMT
They have permissions (investment) just not the one that makes it eligible to offset losses against income from P2P. The structure is equity crowdfunding. You are investing in shares in an SPV that advances the loan to the SME via a commodity agreement. But HMRC say that Sharia compliant 'lending' (although it is presented differently) should be treated for tax purposes like the western equivalent. If I have to declare the 'dividends' from the SPV as interest because it would be interest if not in a Sharia compliant wrapper it should also be subject to the offsetting ability. Or we lose out both ways. The offsetting is subject to specific criteria. There is no reason why Islamic finance should be treated any different to all the non-qualifying interest paying UK platforms like Somo, Capitalise, Shojin who also can't offset losses against P2P income.
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Post by Ace on Nov 22, 2022 15:01:09 GMT
They have permissions (investment) just not the one that makes it eligible to offset losses against income from P2P. The structure is equity crowdfunding. You are investing in shares in an SPV that advances the loan to the SME via a commodity agreement. I was going to research this later, but I expect that you probably already know; can losses on Q be offset against profits from other loans on the same platform? Or is that also disallowed without 36H permission? Will be interesting to see what Q's tax statement says. OK, I stopped being lazy for a while and looked up the answer to my own question. As I read it, the answer is no; if the platform doesn't have 36H permission then you can't offset losses from a loan against P2P profits from other loans even if both loans are on the same platform. B****r
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Post by Penny Pincher on Nov 23, 2022 11:29:23 GMT
Will more than wipe out my interest. Can this loss be offset against P2P interest? Don't think so as Qardus doesn't hold the qualifying permission or appear to offer article 36h loans. It's equity crowdfunding. If not eligible for offsetting against income then any capital loss will be eligible for deduction from capital gains, right?
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littleoldlady
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Running down all platforms due to age
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Post by littleoldlady on Nov 23, 2022 20:46:29 GMT
AFAICS interest + capital returned so far is just under a third of the loan, so (treating all returns as return of capital) max loss is just over two thirds, but as the business seems to have been sold unless the Admin costs eat up all the sale proceeds there should not be a loss that big. I may be uncharacteristically over optimistic but I am hoping for a near full return of capital, (counting interest as such because when a loan goes bad I am only concerned about my capital)
Later edit: It appears that my optimism was not only uncharacteristic, it was unfounded. I expect a total loss of outstanding capital, so a loss of 68.5% in cash terms.
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Greenwood2
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Post by Greenwood2 on Nov 23, 2022 20:53:23 GMT
AFAICS interest + capital returned so far is just under a third of the loan, so (treating all returns as return of capital) max loss is just over two thirds, but as the business seems to have been sold unless the Admin costs eat up all the sale proceeds there should not be a loss that big. I may be uncharacteristically over optimistic but I am hoping for a near full return of capital, (counting interest as such because when a loan goes bad I am only concerned about my capital) Anything where the company is in liquidation or any other sort of windup usually means (virtually) nothing for lenders. Hope this one is different.
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