P2P Money Blog

The 2015 budget didn't contain any firm commitments on the ISA front there was the confirmation that lenders will be able to offset their P2P losses from April 2016.

Excepts from the Budget 2015 document:

2.83 Extending ISA eligibility - The list of qualifying investments for ISAs will be extended to include listed bonds issued by a co-operative and community benefit society and small and medium sized enterprise (SME) securities (not just equities) admitted to trading on a recognised stock exchange from summer 2015. The government will explore further extending the list to include debt (as announced at Autumn Statement 2014) and equity securities offered via crowdfunding platforms and will consult in summer 2015 alongside a response to the consultation on how to include peer-to-peer loans.

2.89 Bad debt relief on investments made through the Peer-to-Peer (P2P) lending industry - As previously announced at Autumn Statement 2014, the government will introduce a new relief to allow individuals lending through P2P to offset any losses from loans which go bad against other P2P income. It will be effective from April 2016 and through self assessment will allow individuals to make a claim for relief on losses incurred from April 2015.

We certainly welcome the ability to offset bad debts, which the treasury forecasts will cost £10million of lost revenue in the 2016 tax year.  This allows lenders to compete more fairly with banks and financial organisations.  We hope that P2P can be included in an ISA in a new group seprate of saving and investment.

Samir Desai, CEO and co-founder of Funding Circle, the leading marketplace for business loans said: 

It's fantastic that the 37,000 people lending to small businesses through Funding Circle will be able to offset their losses from April. This change in the tax system will make lending much fairer for individual investors, putting them in an equal position to larger lenders such as banks, and boosting the average investor return by up to 25% per year overnight. We also look forward to further discussion around a third 'Lending ISA' over the coming months.