More investors looking to boost their tax-free returns are turning to Innovative Finance ISAs, explains CapitalRise.
The Innovative Finance ISA (IFISA) was only introduced in 2016, but it’s already piquing the interest of savvy investors who want their money to work harder; so much so that the HMRC revealed almost £300 million was invested across IFISAs in the last tax year.
The Innovative Finance ISA, or IFISA, is a tax wrapper for money invested in peer-to-peer loans and other alternative investments and can offer double-digit, tax-free returns.
While Cash ISAs tend to pay less than inflation and Stocks and Shares ISAs can rise and fall unpredictably with equity markets; an IFISA, whilst not without risks, can offer significant returns for those willing to invest in the mid to long-term.
In the case of prime property investment platform, CapitalRise, the IFISA allows investors to invest from £1,000 and earn tax-free returns of 8-12% p.a. on exclusive property development investment opportunities, in locations such as Mayfair, Knightsbridge and the Home Counties.
The CapitalRise platform is quick and simple to use, allowing investors to research and select the opportunities they’d like to invest in.
By charging borrowers rather than investors a fee and cutting out traditional middlemen such as banks and fund managers, CapitalRise can offer investors attractive (and often double-digit) returns.
To bring the potential benefits of the IFISA to life, take the following scenario: if the full annual ISA allowance of £20,000 was invested this tax year, and every year for the next 18 years in opportunities with projected returns of 10% p.a., a £360,000 investment could turn into more than £1 million* – thanks to compounded returns and the tax-free ISA wrapper.
Put simply, in less than 20 years, you could potentially become an Innovative Finance ISA millionaire.
*This calculation depends on the investments performing as expected and does not include the effect of any fees. Projections are not reliable indicators of future performance.
|
|
Assumed annual returns |
Annual ISA investment |
Become an ISA millionaire in |
|
Cash ISA |
2% |
£20,000 |
35 years |
|
Innovative Finance ISA |
10% |
£20,000 |
18.8 years |
Uma Rajah, co-founder and CEO at CapitalRise, says: “In just a couple of years since it was introduced, it’s great to see the Innovative Finance ISA increasing in popularity for investors, but there is still a job to be done to ensure people know all of their options when it comes to investing.
“With interest rates at a historic low, investors might want to consider looking to alternative options that deliver strong risk-adjusted returns. With CapitalRise, we believe we’re striking that balance.
“The kind of developments we specialise in, and the level of returns that they offer, would ordinarily only be accessible to those with millions to invest.
“Our model allows individuals to invest at a level that suits them – anything from £1,000 upwards – in some of the finest developments in Prime Central London and the Home Counties.
“With no fees to invest and tax-free returns, we’re seeing investing with an IFISA such as the CapitalRise ISA becoming increasingly popular.”
This is a paid promotion by CapitalRise. The views expressed in this advertorial do not necessarily reflect those of loveMONEY.
IMPORTANT NOTE
This press release is approved as a financial promotion by Gallium Fund Solutions Limited and has been issued by CapitalRise for use by journalist in their professional capacity [and should not be relied upon by retail clients].
Investors should be aware that unlike with Cash ISAs, investing places your capital at risk and there is no compensation for poor investment performance. Forecasts are not reliable indicators of future performance.
The content of this promotion should not be construed as offering investment or tax advice. Tax rules and allowances depend on your circumstances and may change. The opinions set out in this document are not capable of being applied universally and following them will not guarantee success.
ABOUT CAPITALRISE
CapitalRise Finance Ltd is an Appointed Representative of Gallium Fund Solutions Ltd, which is authorised and regulated by the Financial Conduct Authority, registration number 487176. CapitalRise® is a registered trademark of CapitalRise Finance Ltd, a limited company registered in England and Wales (No. 09571824) with its registered office at Jubilee House, 2 Jubilee Place, London SW3 3TQ.