LendingCROWD NZ P2P

[leesal]

I'm just scaling back my investments and being more selective.

Defaults will rise. However these are much higher quality loans compared to HM. Finance Direct are also investing in these loans, they have navigated through the GFC, the security will mitigate part of the loses arising from higher default.

A year ago, I did a presentation on US P2P, and how they performed vs Shares and Real Estate during the GFC. It showed that overall during those 2 years performance was roughly break even, the higher grades made money and the poorer grades lost. Good to have liquidity, but everything not lost in P2P.

[Bjauck]

...
A year ago, I did a presentation on US P2P, and how they performed vs Shares and Real Estate during the GFC. It showed that overall during those 2 years performance was roughly break even, the higher grades made money and the poorer grades lost. Good to have liquidity, but everything not lost in P2P.

For retail investors in NZ P2P though, capital write-offs of loans are not deductible for tax. It is in times like these, that becomes very relevant.
As always DYOR.

[Toukshare]

For retail investors in NZ P2P though, capital write-offs of loans are not deductible for tax. It is in times like these, that becomes very relevant.
As always DYOR.

As you say, DYOR, as my accountants advice is that it is tax deductible if you are investing through a LTD company (rather than as an individual). In my personal circumstances, which may suit others, it is better to invest through a ltd.

[Bjauck]

As you say, DYOR, as my accountants advice is that it is tax deductible if you are investing through a LTD company (rather than as an individual). In my personal circumstances, which may suit others, it is better to invest through a ltd.

Definitely subject to DYOR. I thought "retail investors" was another way of saying individual non-professional investors. I was not referring companies doing the investing.

Unlike in some other jurisdictions, In relation to "retail investors", The NZ P2P sector never bothered to get an IRD ruling on tax consequences.

[leesal]

Definitely subject to DYOR. I thought "retail investors" was another way of saying individual non-professional investors. I was not referring companies doing the investing.

Unlike in some other jurisdictions, In relation to "retail investors", The NZ P2P sector never bothered to get an IRD ruling on tax consequences.

Very good point. If defaults are 8%, thats 2.5%+ at the top bracket that isn't tax deductible. I'm able to take the tax deduction, those who can't it makes a big difference.