applets
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Post by applets on Aug 24, 2017 18:01:11 GMT
applets With regard to an ongoing loan, the T&C's can be changed, but only on an indivdual basis and by mutual consent. Thank you. I am grateful. I am in this loan and don't necessarily disagree with SM sales of default loans. I was, however, concerned at what appeared initially to be a unilateral change of the terms and conditions by MT and then the proposal to change them on the basis of a poll of what is likely to be a subset of lenders who happen to use this forum.
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Post by GSV3MIaC on Aug 24, 2017 18:04:23 GMT
a defaulted loan should not be on SM. Why not? If i want to buy some, and you want to sell me some, why should the platform prevent it? Assuming i know what i'm buying and you know what you are selling, of course.
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robski
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Post by robski on Aug 24, 2017 18:48:04 GMT
Changed mine to yes now for the future changes
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pickles
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Post by pickles on Aug 24, 2017 19:10:19 GMT
I don't see why not, people buy and sell defaulted loans in the non-P2P world.
Taking this thought a stage further, how long before we have derivatives on P2P? Credit Default Swap on MTAW752 anyone?
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elliotn
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Post by elliotn on Aug 25, 2017 2:27:06 GMT
a defaulted loan should not be on SM. Don't understand this, there's a whole industry in distressed debt. There is a chance here for buyers at 14% who may be able to use the tax position advantageously, why deny these opportunities if they have been adequately forewarned?? Edit - crossed with pickles davestorey etc (sorry am reading chronologically & saw this!)
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duck
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Post by duck on Aug 25, 2017 5:35:50 GMT
Personally I don't have a problem with the ability to buy/sell defaulted loans. However following on from elliotn point on tax it could add another level of complexity for those that dread completing SA forms and are not good at keeping perfect records. If you make a claim against Tax for a defaulted loan (when it meets the requirements) it is your duty to balance out any recovery in the following Tax year. With one bullet point recovery this is not difficult, record date and amount of the repayment and note the return suitably. If you sell the defaulted loan it could sell in many small amounts. These details have to be preserved in case of investigation by HMRC. As with all things 'Tax' this will be the responsibility of the investor. For the past two years I have made claims across various platforms. When sorting my 16/17 figures I had to check which loans I had claimed on in 15/16 and then check if any payments had been made and where they had calculate an adjustment. This was time consuming. This situation will be worse as the years pass since recovery can in some cases take several years. Whilst I am 'happy' to perform this task (spreadsheets set up from day 1) I appreciate not every investor is as an.l as I am when it comes to figures
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archie
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Post by archie on Aug 25, 2017 6:27:13 GMT
Personally I don't have a problem with the ability to buy/sell defaulted loans. However following on from elliotn point on tax it could add another level of complexity for those that dread completing SA forms and are not good at keeping perfect records. If you make a claim against Tax for a defaulted loan (when it meets the requirements) it is your duty to balance out any recovery in the following Tax year. With one bullet point recovery this is not difficult, record date and amount of the repayment and note the return suitably. If you sell the defaulted loan it could sell in many small amounts. These details have to be preserved in case of investigation by HMRC. As with all things 'Tax' this will be the responsibility of the investor. For the past two years I have made claims across various platforms. When sorting my 16/17 figures I had to check which loans I had claimed on in 15/16 and then check if any payments had been made and where they had calculate an adjustment. This was time consuming. This situation will be worse as the years pass since recovery can in some cases take several years. Whilst I am 'happy' to perform this task (spreadsheets set up from day 1) I appreciate not every investor is as an.l as I am when it comes to figures This is why the tax statement needs more information showing defaults and recoveries. The latter should highlight the split between recoveries within the current year and those from previous years.
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Post by justdabbling on Aug 25, 2017 6:31:27 GMT
Your posting prompted me to check out the point about having to keep records for the tax return, and for MT you are absolutely right as their tax return template does not include capital losses from defaults, or recovered defaults. However, FS, where I have a default, includes this data in their tax returns. It would be helpful if all the platforms supplied the same data in their tax returns.
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duck
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Post by duck on Aug 25, 2017 7:07:24 GMT
With respect I feel the point I am making is being slightly missed. The onus cannot be thrown onto the platforms. SAIM 1250 envisages when a loan can be deemed to be irrecoverable and whilst HMRC envisage that this task is easiest for the platform to perform the option is also available for the investor to 'deem as irrecoverable'. AC for example have declared loans to be defaulted but not 'irrecoverable' so if the conditions are met the investor can 'deem' these loans to be irrecoverable and make a claim. More on topic the waters are further muddied by SAIM1260 Acquisition of irrecoverable peer to peer loans As an example as to why the onus has to be with the investor, FS this year included the very useful statements "Capital Losses from defaulted loans" and "Capital recovered from defaulted loans". I knew that one of my defaulted loans would repay so I decided not to claim for that loan since I didn't want the returned capital to be treated as income in 17/18. There was no way that FS would know that I was going to do that! They gave me the opportunity to claim and IMO that is as far as the platforms should go. As it was the loan repaid before my accountants saw my figures ...... Next year the "Capital recovered from defaulted loans" figure will in my case be technically correct but in my case 'wrong' since I will not have claimed the full relief available. This is why the onus is still with the investor to have (and maintain) very good records. The platforms cannot be responsible for tax returns or for investors to simply rely on a downloaded statement.
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archie
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Post by archie on Aug 25, 2017 7:18:42 GMT
With respect I feel the point I am making is being slightly missed. The onus cannot be thrown onto the platforms. SAIM 1250 envisages when a loan can be deemed to be irrecoverable and whilst HMRC envisage that this task is easiest for the platform to perform the option is also available for the investor to 'deem as irrecoverable'. AC for example have declared loans to be defaulted but not 'irrecoverable' so if the conditions are met the investor can 'deem' these loans to be irrecoverable and make a claim. More on topic the waters are further muddied by SAIM1260 Acquisition of irrecoverable peer to peer loans As an example as to why the onus has to be with the investor, FS this year included the very useful statements "Capital Losses from defaulted loans" and "Capital recovered from defaulted loans". I knew that one of my defaulted loans would repay so I decided not to claim for that loan since I didn't want the returned capital to be treated as income in 17/18. There was no way that FS would know that I was going to do that! They gave me the opportunity to claim and IMO that is as far as the platforms should go. As it was the loan repaid before my accountants saw my figures ...... Next year the "Capital recovered from defaulted loans" figure will in my case be technically correct but in my case 'wrong' since I will not have claimed the full relief available. This is why the onus is still with the investor to have (and maintain) very good records. The platforms cannot be responsible for tax returns or for investors to simply rely on a downloaded statement. I think all platforms should provide the information on the tax certificate. It's down to the lender to decide whether to claim. I claimed against two platforms last year as it was advantageous to me. I have a spreadsheet with the figures from the tax statements and how much I claimed against each one.
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Post by justdabbling on Aug 25, 2017 7:47:43 GMT
I thought the tax relief had to be applied in the tax year the loan is declared as defaulted by the platform, but perhaps it can be carried forward.
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archie
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Post by archie on Aug 25, 2017 7:50:58 GMT
I thought the tax relief had to be applied in the tax year the loan is declared as defaulted by the platform, but perhaps it can be carried forward. It can be carried forward if you have insufficient P2P tax to offset it against. Edit : As ilmoro posts below that is insufficient P2P tax (your losses from P2P exceed your income from P2P).
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Post by justdabbling on Aug 25, 2017 20:38:09 GMT
I thought the tax relief had to be applied in the tax year the loan is declared as defaulted by the platform, but perhaps it can be carried forward. It can be carried forward if you have insufficient tax to offset it against. Thanks, I would always have sufficient tax to offset, so I must have ignored that part when I looked into it. I still think it would be useful if all platforms included defaults and repayments in their tax statements for the year in which the defaults are declared and subsequent late repayments are paid. but MT may well add it soon, now they have a default.
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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 Aug 25, 2017 21:43:54 GMT
It can be carried forward if you have insufficient tax to offset it against. Thanks, I would always have sufficient tax to offset, so I must have ignored that part when I looked into it. I still think it would be useful if all platforms included defaults and repayments in their tax statements for the year in which the defaults are declared and subsequent late repayments are paid. but MT may well add it soon, now they have a default. Just a clarification. Insuffucient tax means insufficient taxable income from P2P you cant offset losses against earnings from non-p2p sources eg bank interest.
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macq
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Post by macq on Aug 26, 2017 6:31:36 GMT
have no problem with trading defaults on a SM but do think it should be on a separate page or clearly marked as in default for both the buyer & the platforms benefit as can be no complaints at a later date. This may be completely of the wall & random thinking but i would say if MT (or any company ) allow & are happy for their customers to trade defaulted loans then may be if people want to sell ALL their loans and cash out an account that the platform should pay off the defaults as well and try to sell them on the SM themselves
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