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Interest after Tax and Fees

The table below illustrates how much interest you could earn on your loan investment depending upon how much you invest, what interest rate you choose, whether you use our IFISA wrapper, your Personal Savings Allowance and your tax rate.

Impact of IFISA fee and tax on loan interest

Loan Investment Amount
£20,000
Interest before fee and taxFee for IFISA tax wrapperInterest after Fee and Tax
See the column for your tax rate
20%
Basic
Rate
40%
Higher
Rate
45%
Additional
Rate
Interest Rate 5.5%Outside IFISA wrapperInterest on loan p.a.£1,100N/A£880£660£605
If using Personal Savings Allowance *£1,080£860N/A
Inside IFISA wrapper **Interest on loan p.a.£1,100-£240£860£860£860
Interest Rate 6.5%Outside IFISA wrapperInterest on loan p.a.£1,300N/A£1,040£780£715
If using Personal Savings Allowance *£1,240£980N/A
Inside IFISA wrapper **Interest on loan p.a.£1,300-£240£1,060£1,060£1,060
Loan Investment Amount
£100,000
Interest before fee and taxFee for IFISA tax wrapperInterest after Fee and Tax
See the column for your tax rate
20%
Basic
Rate
40%
Higher
Rate
45%
Additional
Rate
Interest Rate 5.5%Outside IFISA wrapperInterest on loan p.a.£5,500N/A£4,400£3,300£3,025
If using Personal Savings Allowance *£4,600£3,500N/A
Inside IFISA wrapper **Interest on loan p.a.£5,500-£1,200£4,300£4,300£4,300
Interest Rate 6.5%Outside IFISA wrapperInterest on loan p.a.£6,500N/A£5,200£3,900£3,575
If using Personal Savings Allowance *£5,400£4,100N/A
Inside IFISA wrapper **Interest on loan p.a.£6,500-£1,200£5,300£5,300£5,300

The purpose of this table is to indicate the impact of the FOLK2FOLK IFISA fee on the amount of interest you could receive from a loan in the IFISA tax wrapper.  This is compared against the amount of interest you could receive if a loan were not in the IFISA tax wrapper i.e. where the IFISA fee is not payable and the impact of tax will vary according to your personal tax situation. 

You should take into account your own tax situation (tax rate, personal savings allowance and any other tax factors) using figures for the tax year in question. The table uses figures from the HMRC website but you should note that tax rates and the tax rules are subject to change.

* Personal savings allowance for the tax year 2017-18 is £1,000 for Basic rate taxpayers and £500 for higher rate taxpayers.

** This assumes you use your entire 2017-18 ISA allowance of £20,000 on the FOLK2FOLK IFISA.

Source: https://www.gov.uk/government/publications/tax-and-tax-credit-rates-and-thresholds-for-2017-18/tax-and-tax-credit-rates-and-thresholds-for-2017-18#fn:1

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