What is an Individual Savings Account (ISA)?
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An ISA is an Individual Savings Account, effectively a 'wrapper' in which your savings and investments are exempt from taxation.
There are several different types of ISA available including Cash ISAs, Stocks and Shares ISAs, Innovative Finance ISAs, and Lifetime ISAs.
You can put money into one of each kind of ISA, up to a set aggregate limit (currently £20,000), each tax year. This limit is known as your ‘ISA allowance’. Any returns or gains made from money placed in an ISA are exempt from income and capital gains tax.
What is an Innovative Finance ISA?
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Innovative Finance ISAs were introduced by the government in 2016 and allows individuals to use their annual ISA allowance to lend funds through investments such as Loan Based Crowdfunding or Peer-to-Peer (P2P) Lending and Crowdfunded Debt Securities. This means that you can invest in a Tifosy bond through an ISA.
What is the difference between a cash ISA, stocks & shares ISA and Innovative Finance ISA?
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Cash ISAs can include savings in bank and building society accounts and some National Savings and Investments products. Stocks & Shares ISAs can include shares in companies, unit trusts and investment funds, corporate bonds and government bonds. Innovative Finance ISAs can include Peer-to-Peer Loans (loans that you give to other people or businesses without using a bank) and Crowdfunding Debentures (investing in a business by buying its debt). Bonds offered on the Tifosy platform fall into the latter category.
Who can setup an ISA?
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You must be:
- Aged 18 or over
- Resident in the UK
- A Crown servant (for example diplomatic or overseas civil service) or their spouse or civil partner if you don’t live in the UK
- You may not hold an ISA with or on behalf of someone else
What is the annual ISA allowance?
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The annual ISA allowance may change each tax year. The ISA allowance for 2018-19 tax year is £20,000. You may wish to learn more about your ISA allowance from the government website. https://www.gov.uk/individual-savings-accounts/overview
What is a tax year?
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The tax year runs from 6th April one year to the 5th April the following year. For clarity, for the 2018-19 tax year runs from the 6th April 2018 to the 5th of April 2019.
Will my ISA allowance roll over if I do not use it all in a tax year?
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If you do not invest your full ISA allowance over the course of a tax year, the remainder does not roll over to the next tax year. For example, if you only invested £10,000 of your £20,000 ISA allowance in 2017/18, that does not mean that next year your ISA this year allowance is £30,000. Your ISA allowance would remain at £20,000 for 2018/19.
How many ISAs can I have in one year?
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You can only have one of each type of ISA each tax year. You can only subscribe to one Cash ISA, one Stock and Shares ISA and one Innovative Finnace ISA. This is permitted as long as the total invested in ISAs for the year does not exceed the annual allowance. In the next tax-year you can subscribe to an additional ISA of each type again.
How can I setup a Tifosy IFISA?
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To setup a Tifosy IFISA account, simply follow the entirely online process at
www.tifosy.com/ifisa, all you’ll need are your personal details (including your National Insurance number) to hand.
What information do you need to setup a Tifosy IFISA?
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To set up your Tifosy ISA you will need your personal information including your address and National Insurance number. In order to make a deposit, you will require the details of your preferred payment method. If that is transferring from another ISA account, you would need to have the details of the account to hand.
How do I pay in to my Tifosy IFISA?
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Once you have opened a Tifosy IFISA account, you will be able to deposit in via debit card, bank transfer or cheque via the ISA section of your Tifosy profile. You can also transfer funds in from another ISA, which you can also action from the ISA section of your Tifosy profile.
Can I transfer money in from other ISAs I hold?
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You can transfer your ISA from one provider to another, and from one kind of ISA to another (e.g. from a Cash ISA to an Innovative Finance ISA), at any time. Transfers must be made in cash. You will not be able to appoint another ISA manager to hold bonds issued on Tifosy and you cannot transfer in investments made outside your Tifosy IFISA. This means that you can only deposit into one IFISA provider per year. The transfer process typically takes 2-3 weeks. You must complete an ISA transfer form in addition to completing the Tifosy IFISA application.
Can I transfer existing Tifosy investments into my IFISA account?
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No. ISA rules, set out by the Treasury, do not allow direct transfers of existing loan investments into an Innovative Finance ISA.
Can an IFISA be held with more than one provider?
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The rules for IFISAs are the same as with cash or stocks and shares ISAs. You can only pay into one each tax year, but can open a new IFISA with a different platform each year if you wish to. If you have multiple IFISA open, you are only allowed to pay into one of them in each tax year.
How do I make an investment from my IFISA account?
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Once you have opened your Tifosy IFISA account, you can choose from the ISA eligible investment opportunities on the ‘Explore’ page at
www.tifosy.com. If you have already registered an ISA account with Tifosy, this option will appear on the payment step of the investment process. If you do not have a Tifosy ISA account, you will be able to set this up, deposit and invest within the investment process of an ISA eligible bond.
What is the benefit of making an investment through my Tifosy IFISA?
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By investing in Tifosy bonds through an ISA, you are able to earn tax-free returns on your investments. You can deposit up to your annual allowance (£20,000) or transfer ISA wrapped funds into your Tifosy ISA and invest tax-free.
Do I need to sign Terms & Conditions?
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When setting up your Tifosy ISA account, you will be required to read through and accept special IFISA Terms and Conditions.
Is there a cancellation period?
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There is a 14-day cancellation period within which you have the right to cancel your account. If you cancel with the 14 calendar days, you will still be able to open an IFISA with us or another ISA provider. You will also have not used any of your current annual allowance. Once the 14-day cancellation period has passed, this will no longer apply and this would be included within your annual allowance.
What if I have made an investment during the cancellation period?
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If you choose to cancel your IFISA with Tifosy but have already purchased bonds through your Tifosy IFISA, Tifosy will refund any investments to your ISA account and in order to close you IFISA account, you must request to withdraw the money within the 14 day cancellation period. After successfully completing this process you will still be able to open an IFISA with us for another ISA provider.
Will my Tifosy IFISA earn interest?
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Uninvested cash funds in your Tifosy IFISA do not earn interest. However, should you invest those funds in Tofisy bonds, then they will begin to earn interest at the advertised rates.
Will I/my investments receive any protection?
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Like all peer-to-peer lending platforms, we fall outside of the scope of the Financial Services Compensation Scheme (“FSCS”), though we are regulated by the Financial Conduct Authority (FCA). This means that, should a peer-to-peer lending platform fail for any reason, those investing (lending) directly via the platform would have no recourse to the FSCS. This is that case whether you invest via an IFISA or not.
Are there any fees, charges or deductions?
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Tifosy will take no fees or make any deductions from your ISA contribution, investments, interest or principal payments.
How can I monitor my IFISA and investments?
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You will be able to monitor the progress of your IFISA investments through the "my ISA" section of your Tifosy account profile.
How do I contact Tifosy if I have further questions?
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If you have any further questions about the Tifosy IFISA you are able to contact us via email at info@tifosy.com or you can call us on +44 (0) 20 7349 0622.
Does Tifosy give advice?
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Tifosy is not allowed to provide legal, investment or tax advice. We recommend that you seek suitable independent advice before investing.
What happens to my IFISA if I die?
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In the event of your death, your Tifosy IFISA will end when either your executor closes it or the administration of your estate is completed.
Otherwise, Tifosy will close your IFISA three years and one day after you die. There will be no Income Tax or Capital Gains Tax to pay up to that date but ISA investments will form part of your estate for inheritance tax purposes.
Tifosy may be instructed to sell the investments and either pay the proceeds to the administrator or beneficiary of your estate or transfer the investments directly to them.