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Post by Deleted on Nov 5, 2016 10:25:10 GMT
I'm only a tiny investor compared to many on this forum but as a 40% tax payer my Personal Savings Allowance of £500 disappears very quickly on P2P sites especially now I've delved into higher rate platforms such as SS.
I'm certainly reluctant to invest further in this sector with it's inherent risks when a further 40% will be knocked off my interest.
Do others not find this currently puts them off investing largers sums ?
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pom
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Post by pom on Nov 5, 2016 11:48:20 GMT
I'm certainly reluctant to invest further in this sector with it's inherent risks when a further 40% will be knocked off my interest. Do others not find this currently puts them off investing largers sums ? Not really, 60% of the p2p rates is still better than 60% of bank rates. Doesn't mean I'm not picky about what to invest & where (and will wait for an ifisa on a platform I want rather than jump into the first that comes along), but tax is a minor issue, other than ensuring I have sufficient liquidity to pay the bill!!! Edit: I should probably caveat this that i'm able to reduce my tax bill by increasing pension contributions (tho not enough to protect all my investment income from 40%) and that my p2p money is a small enough relative to everything else to mitigate risks
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seeingred
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Post by seeingred on Nov 5, 2016 12:15:21 GMT
The important issue is not when (they will arrive when FCA authorises a batch of P2P platforms at the same time) and may be quite soon, but how to transfer existing loan parts into one's ISA.
The HMRC rules apparently do not allow transfer of non-isa loans, so you have in effect to sell and then rebuy them using isa cash. Z platform may offer a low fee system to enable this to be done.
If you transfer (for example) £100,000 of old cash-isa money into a P2P platform, and if you have already £100,000 of non-isa loan parts in that platform (many people have far more), how do you most easily and on which platform, enable the interest on £100,000 (say 7000pa) to become tax free, saving maybe 40% of £7000 pa.
As I have said, HMRC rules apparently prevent you simply sheltering your existing portfolio of loan parts inside the new F-ISA wrapper, and removing an equivalent quantity of cash.
The other issue is that P2P platforms expect a wall of cash to arrive when F-ISAs are authorised to major platforms, and there will not be the borrowers to soak it up - not good quality borrowers anyway. Limits or quotas may be set therefore?
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rick24
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Post by rick24 on Nov 5, 2016 12:18:56 GMT
As a 40% taxpayer, I intend to pay all the proceeds into my SIPP, thereby deferring the tax bill until drawdown (i.e. it will be paid on the income from the pension - hopefully at 20%).
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Balder
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Post by Balder on Nov 5, 2016 12:25:27 GMT
As a 40% taxpayer, I intend to pay all the proceeds into my SIPP, thereby deferring the tax bill until drawdown (i.e. it will be paid on the income from the pension - hopefully at 20%). rick24 assume you will have the capital within the SIPP as well, you can't have capital outside of the sipp and just put the interest into your SIPP without any tax consequence.
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Post by Deleted on Nov 5, 2016 12:38:24 GMT
the other a HR taxpayer (due to investment income), any tax wrapper is attractive. Your investment pot is clearly a touch larger than mine ....Frankly, I still feel the precious tax wrapping of ISAs/SIPPs is still better deployed to other asset classes. Are you refering to Stocks and Shares here ?? I assume not cash at todays pitiful rates !!If P2P was eligible inside S&S ISAs on a multi-dealer platform then I might rotate some money into P2P from other assets but the idea of locking myself into a single platform via an IFISA is unattractive. Am I right in saying I can open one IFISA per tax year? So I can open one between now and April and a 2nd post April ?
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pom
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Post by pom on Nov 5, 2016 12:51:15 GMT
You can pay new money into only one in a tax year...you may be able to transfer in previous ISA money into another
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rick24
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Post by rick24 on Nov 5, 2016 14:38:40 GMT
@ colin
I assume that the interest on the lending is income, like any other (after the £1000/£500 allowance has been used up). If you pay a proportion of your income into a SIPP, you get tax relief on that proportion. Not sure why income from p2p lending would be any different.
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Post by Deleted on Nov 5, 2016 14:55:42 GMT
The important issue is not when (they will arrive when FCA authorises a batch of P2P platforms at the same time) and may be quite soon, but how to transfer existing loan parts into one's ISA.
The HMRC rules apparently do not allow transfer of non-isa loans, so you have in effect to sell and then rebuy them using isa cash. Z platform may offer a low fee system to enable this to be done. If you transfer (for example) £100,000 of old cash-isa money into a P2P platform, and if you have already £100,000 of non-isa loan parts in that platform (many people have far more), how do you most easily and on which platform, enable the interest on £100,000 (say 7000pa) to become tax free, saving maybe 40% of £7000 pa. Sadly the issue of what to do with 100k isn't one I'll be losing any sleep over ..... Should be considerably easier to manouevre my level of investment around!
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Post by Deleted on Nov 5, 2016 14:58:43 GMT
You can pay new money into only one in a tax year...you may be able to transfer in previous ISA money into another
Let's say I put 10k into a Cash ISA this year 16/17
Then for year 17/18 I can put new ISA money into ONE IFISA platform but ....... I can transfer the 10k from my previous years cash ISA across as MANY IFISA platforms as I wish?
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pom
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Post by pom on Nov 5, 2016 15:41:17 GMT
You can pay new money into only one in a tax year...you may be able to transfer in previous ISA money into another
Let's say I put 10k into a Cash ISA this year 16/17
Then for year 17/18 I can put new ISA money into ONE IFISA platform but ....... I can transfer the 10k from my previous years cash ISA across as MANY IFISA platforms as I wish?Potentially...provided they all allow partial transfers in/out (some older ones are a bit all/nothing) and the new ones accept just transfers (ie don't insist on new money)
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Maestro
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Post by Maestro on Nov 5, 2016 15:43:03 GMT
I am not a UK resident and hence don't quality for ISA but I would love to see a P2P product that can be taxed on CGT bases. (FS secondary market helps). I am taxed at 52%(!).
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pom
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Post by pom on Nov 5, 2016 15:50:11 GMT
I am not a UK resident and hence don't quality for ISA but I would love to see a P2P product that can be taxed on CGT bases. (FS secondary market helps). I am taxed at 52%(!). You can get a bit at ABL...instant returns count as a discount therefore you get a smidgen of cap gain as they repay...plus can potentially make a bit as capital on the SM. Not much in the scheme of things tho unless you're investing a lot and then the income exposure would be rather large :-D Otherwise BTL equity seems to be the only way but income/gains pretty unpredictable
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Maestro
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Post by Maestro on Nov 5, 2016 16:11:45 GMT
I am not a UK resident and hence don't quality for ISA but I would love to see a P2P product that can be taxed on CGT bases. (FS secondary market helps). I am taxed at 52%(!). You can get a bit at ABL...instant returns count as a discount therefore you get a smidgen of cap gain as they repay...plus can potentially make a bit as capital on the SM. Not much in the scheme of things tho unless you're investing a lot and then the income exposure would be rather large :-D Otherwise BTL equity seems to be the only way but income/gains pretty unpredictable Thanks. I have a tiny investment in ABL, but personally have not been convinced on the long term viability of the platform. I have thought about closing that account a couple of times but stopped at the last minute. I sold majority of the UK BTL equity positions between April-July but kept some high yielding ones or the one prohibitively expensive to sell, but would like to see some wider discounts. Given recent NAV discounts on some P2P funds, I have started to dabble some spread betting positions on them and on the look out for non-levered (to avoid financing costs) spread betting providers if anyone can recommend one.
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Post by Deleted on Nov 5, 2016 17:40:57 GMT
Ok just to check my understanding of the situation is correct.
Let's say I put 10k into a Cash ISA this year 16/17
Then for year 17/18 I can put new ISA money into ONE IFISA platform but ....... I can transfer the 10k from my previous years cash ISA across as MANY IFISA platforms as I wish? Potentially...provided they all allow partial transfers in/out (some older ones are a bit all/nothing) and the new ones accept just transfers (ie don't insist on new money) Aaaah, I hadn't considered that transfers in wouldn't be allowed!! In terms of the IFISA rules am I right that new money can only be placed in one IFISA but previous ISA money can be transferred into however many Platforms that allow it ??
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