Investing in P2P as a Limited Company

The quick answer is yes.  Its also worth noting that all income (including cash back and other incentives which may not be subject to income tax if received in a the capacity of an individual investor) and capital gains will be captured (for corporation tax purposes there is no distinction between income and capital gains).

I've only just been made aware of your forum and it looks great, although I am completely new to forums to please excuse me if I'm not following the right etiquette!


You should be aware that a limited compa
ny cannot invest in loans to other limited companies via a p2p platform, so this will limit some of the loan opportunities available. This is one of the rules under electronic peer to peer legislation (article 36H)

I am the MD of HNW Lending Ltd. We are a fully FCA authorised firm (authorised in January 2017) and also have HMRC permission to offer IF ISAs and have flexible ISAs


We have been going for 3 years, have done over 150 loans, and have never lost a penny of interest or capital to date as all the loans we do are secured loans. Secured loans means first or second charge on property or taking an asset like a high value car or plane into a storage facility under our control



We are basically funded by a collection of wealthy individuals, with the average individual investor having over £100k invested in our loans. We do however allow investors to put a minimum of £5k per loan (or £10k per loan outside of the ISA). Investors choose which loans they wish to invest in and the rate investors earn ranges from about 7% to 15% depending on the risk of the loan - ie a low LTV (loan to value) first charge would pay lower interest than a high LTV second charge



My number is 07958 636 106 and email is ben@hnwlending.co.uk if you wanted to find out any more information so that you can update your post



Thanks

Ben

following this thread.

Get a new accountant.

TBF, it sounds like almost any half-way competent accountant would be an improvement.

I believe you would need to treat the losses on investment held within you Ltd co as a trading loss and claim the loss in the normal way against trading profit for corporation tax purposes in the current year or carry these forward against future trading profits.  You also carry losses back 12 months if you were undertaking the same activity previously.  Although the losses may have been incurred from 'investment' activity, this should still be treated as part of the trade of the company (in the same way interest income and capital gains will be captured as trading profit for CT purposes).  You don't have to show the losses on your investments separately, it should be all included in reaching your trading profit or loss for corporation tax purposes.  Unlike personal taxation, corporation tends to lump in profit, capital gains etc into one amount subject to CT.

High level UK gov guidance can be found here: 

www.gov.uk/guidance/corporation-tax-calculating-and-claiming-a-loss#trading-losses

Hope that helps.

I confess that as my losses on my 'ltd' account p2p are c£50 a year and that tax break that'd bring would be a third of that (I think) I don't bother claiming - my accountant is freaked out enough by the impenetrable thousands of loan parts across several platforms let alone explaining losses which may or may not be billed as losses by platforms....

I CBA with any of those trawling letters from the taxman 'we are looking at your accounts' and then asking them to trust FC's (for example) impossible account reconciliations that rarely reconcile.

Jack P