Published on December 11th, 2013 | by P2P Lending Advice0
Tax bonus on the way for peer-to-peer lenders
It’s shaping up to be a happy new year for peer-to-peer lenders, as rumours gather strength that the Chancellor will soon announce that some platforms can be included in ISAs.
Individual Savings Accounts, which allow holders to annually save up to £11,520 in stocks and shares, or £5,760 in cash without having to pay any capital gains or income tax on returns, have proven massively popular with the British public, who are estimated to have saved over £57 billion through them in the last tax year alone.
Until now, savers have not been able to access peer-to-peer lending through their ISAs, but many believe that the P-2-P industry is showing signs of maturity and stability, and with the potential risks now known and to an extent mitigated, the government is looking to change the rules.
The big advantages of this move are twofold – there is the potential release of a great deal more capital for small businesses – one platform, Funding Circle, believes around a third of its lenders might invest more if they could do so through their ISAs. And secondly, it will mean an alternative to the poor savings rates which are still causing financial worries for many households.
There are many issues still to be ironed out, not the least of which is whether P-2-P will be offered in cash or stocks and shares ISAs, but industry experts are confident any remaining hurdles can be quickly negotiated. It had been predicted by many that the move would be signalled in this year’s Autumn Statement, but that turned out not to be the case. Now it looks likely that a consultation may start at some point in 2014, with the new ISA rules to take effect in April 2015. Fingers crossed.
For any more information please contact us here at Peer 2 Peer Lending Advice here.