Declaring your Zopa earnings to HMRC

1 min • 24 Mar 2017
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With the new tax year fast approaching, we’ve put together a handy guide to help you find what you need to do to declare your Zopa investments to HMRC.

Do I have to pay tax on the money I earn through my Zopa investments?

All Zopa earnings are paid to you without any tax deducted, so you must declare them to HMRC. On your “Statements” page, just after the start of the new tax year you’ll find your 2016/17 annual statement, showing the total gross interest you’ve received over the last 12 months, to make this as easy as possible.

This link will be updated with your 2016/17 statement promptly after the tax year ends.

More information on declaring your Zopa earnings

What guidance is there from HMRC?

In 2015, HMRC updated their guidelines to enable investors to make a claim for tax relief on losses against interest earned on their peer-to-peer investments. Read the full guidance

Here’s further current advice we have from an HMRC officer:

  • The guidance from HMRC around peer-to-peer lending and how to declare earnings can be found here.
  • Zopa does not collect taxes on your behalf and you must declare your earnings to HMRC. If you fill out a self-assessment tax return, you must include your Zopa earnings; if you are not self-assessed, contact HMRC for instructions on how to declare.
  • “Refer a friend” bonuses are taxable and should be declared guidance
  • “Cash back” is typically not considered taxable guidance
  • Early adopter bonuses are also taxable
  • You can’t offset fees for selling loans against income from loans

Read the HMRC guidance in full

Andrew Lawson is Chief Product Officer at Zopa.

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