The Enterprise Investment Association focuses on equity investment – shares as opposed to the loans we specialise in here at Money&Co. Today we offer a glimpse over the other side of the investment fence as the association announces the winners of some gongs:
The Enterprise Investment Scheme Association, the membership organisation focused on investing in the UK’s growth businesses, has announced the winners of its annual awards at a glittering, albeit online, event introduced by the chair of the EISA, Lord Flight, and hosted by Director General Mark Brownridge. Economic Secretary, John Glen, representing the Government, endorsed the importance of growth businesses to the UK economy, and emphasised the value of the Enterprise Investment Scheme in attracting the investment to make the growth possible.
The Awards were presented to firms, advisers, companies, individuals and journalists that achieved outstanding performance in the context of the EIS & SEIS schemes during 2020.
Speaking on behalf of the EISA, Mark Brownridge said, “It incredibly important to recognise the important work the industry undertakes, this year more than ever. The Awards denote excellence in a number of EIS and SEIS fields and from an unprecedented list of entrants we have been pleased to showcase some outstanding winners.
Historical Performance And IFISA Process Guide
That figure is the result of over £20 million of loans facilitated on the site, as we bring individuals looking for a good return on capital together with carefully vetted small companies seeking funds for growth. Bear in mind that lenders’ capital is at risk. Read warnings on site before committing capital.
All loans on site are eligible to be held in a Money&Co. Innovative Finance Individual Savings Account (IFISA), up to the annual ISA limit of £20,000. Such loans offer lenders tax-free income. Our offering is an Innovative Finance ISA (IFISA) that can hold the peer-to-peer (P2P) business loans that Money&Co. facilitates. For the purposes of this article, the terms ISA and IFISA are interchangeable.
So here’s our guide to the process:
The ISA allowance for 2019/20 is unchanged from last tax year at £20,000, allowing a married couple to put £40,000 into a tax-free environment. Over three years, an investment of this scale in two Money&Co. Innovative Finance ISAs would generate £8,400 of income completely free of tax. We’re assuming a 7 per cent return, net of charges and free of tax here.
Once you have made your initial commitment, you might then consider diversifying – buying a spread of loans. To do this, you can go into the “loans for sale” market. All loans bought in this market also qualify for IFISA tax benefits.
Risk: Security, Access, Yield
Do consider not just the return, but the security and the ease of access to your investment. We write regularly about these three key factors. Here’s one of several earlier articles on security, access and yield.