Changes to ISA rules

Changes to ISA rules

Changes to ISA rules – The recent market weakness has meant that shares in P2P Global Investments (P2P), (the specialist investment trust that provides exposure to a portfolio of peer-to-peer loans) have fallen from more than £11.50 in February to around £10 and now trade at a small discount to NAV with a prospective yield of 6%.

We mentioned in a previous blog that ISA rules have been amended so that now you can include investments into Peer-to-Peer within an ISA. Peer to Peer loans allow people with spare cash to lend directly to people or businesses who want a short-term loan. By cutting out the middleman they are able to offer ‘savers’ a higher return on their money, while allowing borrowers to obtain funds at a cheaper rate.

The peer-to-peer industry has grown dramatically since the financial crisis and is now well established in most of the developed economies around the world.

P2P Global Investments raised £200m when it floated on the London Stock Exchange in May 2014 and has since had two further share issues including separately listed C shares that came to the market in June.

The fund invests in a portfolio of peer-to-peer loans with targeted annualised returns of 5% to 15% spread across multiple platforms, countries and credit risks, with the aim of generating an attractive level of income and capital growth. It hopes to pay an annual yield of 6% to 8% with quarterly distributions, and if held in an ISA there would be no tax to pay on the income.

If you are unaware of this savings proposition, seek advice from a good IFA.

Registered in England and Wales. Registered Number 5553273.
Registered Address: 8f Millars Brook, Molly Millars Lane, Wokingham, Berkshire, RG41 2AD.

A pension is a long-term investment that typically cannot be accessed until age 55 (57 from April 2028). The level of pension benefits offered could change depending on the value of your investments (and any income they may generate).

The interest rates in effect at the time you begin receiving benefits may also have an impact on your pension income. The tax consequences of pension withdrawals will depend on your unique situation. In later Finance Acts, tax rates, tax bases, and tax relief may change.

The opinions expressed by Ray Best are meant to inform and educate. Before making any investment decisions always take advice that is pertinent to your investment personality and financial situation.

You are aware that past performance will not necessarily be repeated in the future, but you should be aware that persistent poor performance invariably will.

The value of an investment and the income from it could go down as well as up.

The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

UnaVida Wealth Management Ltd. is directly authorised and regulated by the Financial Conduct Authority (440577).

The guidance in this website is primarily aimed at a UK audience and is subject to regulation by the Financial Conduct Authority (FCA).

The Financial Conduct Authority does not regulate tax planning, estate planning, or wills and any form of legal documentation.