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jamieclawhorn · 6 years ago

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Why I’d chose an ISA over buy-to-let any day

One of the most significant benefits of buy-to-let investing is the fact that it is relatively easy to boost your returns by borrowing. Mortgage lenders are generally quite happy to give landlords a mortgage equivalent to around 60% of a property’s value, meaning that you only have to invest 40% of your own money.

On this basis, an investor acquiring a property worth £300,000 with a potential rental income of £15,000 per annum would only need to invest £120,000 of their own money to generate an annual yield of 12.5%, excluding mortgage fees, taxes and other costs.

However, while this 12.5% return might look attractive, the problem with leverage is that it can be just as much of a problem as a benefit. If property prices suddenly lurch lower or if the property is left empty and the investor cannot meet repayment obligations, then the bank is in control — not something anyone wants.

The government’s recent tax changes have also made it harder to make money in buy-to-let by reducing the amount of tax relief available on mortgage interest. These changes now mean that it is less attractive to borrow money and they have weighed on landlords’ profit margins.

The changes are just one of the reasons why I would rather invest my money in an ISA rather than buy-to-let property.

Two key advantages

ISAs have two main advantages over buy-to-let in my opinion.

First of all, there are the tax advantages of using an ISA. Any income received and capital gains generated on the sale of assets held within an ISA do not attract tax. You don’t even need to report the numbers on your tax return.

Second, it is easier to build a well-diversified global portfolio in an ISA than it is with buy-to-let property. Not only can you own international funds, bonds and small-cap stocks in an ISA wrapper, but some providers also let you invest directly in international stocks such as Apple and Amazon. The returns from these investments have left buy-to-let trailing in the dust over the past two decades, and remember, there’s no capital gains tax to pay when you sell either.

That being said, the one drawback of investing via an ISA rather than buy-to-let is that you can’t borrow to improve your returns, which might put some investors off.

However, I do not think the trade-off is worth it. I’d rather sacrifice my ability to borrow for the tax benefits and international investment exposure offered by an ISA. What’s more, buy-to-let property also requires a great deal of work to keep up to standard, find tenants and chase up rent payments. By comparison, equity investing is relatively effortless.

The bottom line

So, that’s why I’d choose an ISA over buy-to-let any day. ISA are much more flexible, offer tax benefits and don’t need babysitting. The same can’t be said for buy-to-let property.

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linabrigette · 7 years ago

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Why Canada has Emerged as a Leading Blockchain and Crypto Nation: Expert Take

In our Expert Takes, opinion leaders from inside and outside the crypto industry express their views, share their experience and give professional advice. Expert Takes cover everything from Blockchain technology and ICO funding to taxation, regulation, and cryptocurrency adoption by different sectors of the economy.

If you would like to contribute an Expert Take, please email your ideas and CV to [email protected].

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. This article does not contain investment advice or recommendations. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Canada has emerged as a leading crypto nation based on its innovation, low energy costs, high internet speed and favorable regulatory regime. While it ranks third in the world behind the U.S. and the UK when it comes to embracing Blockchain technology, Ethereum Blockchain technology adoption around the world with a wide variety of applications in finance, government, legal, health, education, space, national and multinational cryptocurrencies, energy, initial coin offerings and others is unparalleled.

A study conducted by Cornell University shows that “The Ethereum nodes are both in the latency space, and also geographically, more distributed around the world, as opposed to Bitcoin nodes, which tend to be located in data centers” explained Emin Gün Sirer, Cornell professor and computer scientist.

Center for Blockchain innovation

Canada’s dominance in Blockchain innovation stems in part from Toronto being home to Vitalik Buterin who is the inventor of the Ethereum Blockchain, a second-generation open source software platform, with a general scripting language, which created a protocol for building reliable decentralized trusted networks. It extends the functionality of Satoshi Nakamoto’s Blockchain design which powered decentralized peer-to-peer Bitcoin payment, by adding the concept of smart contracts, also called scripting.

This feature allows the platform to store and run computer programs and enables developers to build and deploy decentralized applications and create whatever operations they want with permanent, trusted record of assets and transactions. The first public Ethereum backed network went live in 2015 and supports ether (ETH), currently the second highest valued cryptocurrency at $63 Billion. ETH finances the Ethereum Swiss Foundation and is used by application developers to pay for transaction fees and services on the Ethereum network.

The platform has worldwide adoption. As Nick Johnson, the chief software architect of Ethereum Foundation, puts it:

“We are building a bridge between the human readability of cryptographic addresses and machine readability. While some others are working similar platforms that they feel may have their own advantages, the size of the development teams around Ethereum ballooned with initial spikes in interest to something larger than anything else in the space. With that, application development, innovation in scaling and other areas followed the trend, thereby creating a snowball effect.”

Ron Resnick, Executive Director of the Enterprise Ethereum Alliance which launched last year adds:

“EEA serves as the connective tissue between Ethereum Blockchain and the evolving enterprise industry with over 450 members from all around the world — 135 in the Banking Work Group — which are driving production deployments through a community of over 30,000 developers.”

Take for example ConsenSys, an EEA member firm, which various Ethereum projects including Quorum, and the EU Blockchain Observatory and Forum and trains Ethereum developers at its Academy.

Cryptocurrency mining

But it’s not only Blockchain innovation where Canada excels in. According to Hydro Quebec, the province has an energy surplus equivalent to 100 Terawatt hours over 10 years and offers some of the lowest electricity rates in North America. This has drawn cryptominers to the region, including from China, in droves. A cryptominers easy, breezy life style starkly contrasts that with a gold miner who works 5,400 to 5,600 feet below surface, at suffocating temperatures, dripping with sweat, while punching holes into burning rock walls, to find hidden gold, in the dark.

Here is an example. China’s Bitmain Technologies began mining in Canada in 2016, when ETH traded at $1. When ETH’s price rose 63,600% to $636 with no implemented hard cap on the total ETH supply, Bitmain first announced a new specialized mining system for ETH; then set its eyes on cryptocurrency mining sites in Quebec, as it takes on average 29.05 TWh annually to operate a cryptocurrency mining operation. That’s about 0.13 percent of total global electricity consumption.

While this may be potential bad news for the smaller cryptominers in the region, a local ETH miner shrugged it off:

“Quebec is one of the best places in the world for mining, thanks to low cost electricity, cool temperatures, and high-speed internet. There’s a lot of data centers in Montreal and they’ll rent you a space for your own server or ZTE smartphone–Sugar S11. Since you’d be paying about half to 1/3rd the electricity price of Ontario, then the added expense of rent is well worth it”

However, recently Quebec Premier Philippe Couillard warned that “Cryptominers planning to move to the region will not get cheap electricity from the government-owned utility Hydro-Quebec, as the utility may not have enough power to meet the demand.” The utility has received an order to await instructions from the government.

Light cryptocurrency regulation

Excessive regulation could stifle innovation; accordingly, Canada lightly regulates cryptocurrency/ICO/tokens. And offers a wide selection of government — federal and provincial — incentives and aid to startup tech companies.

Last year, with the boom in Ethereum Blockchain based ICOs that raised $4 Billion worldwide, the Canadian Securities Administrators suggested that Canadian Securities Law may be potentially applicable to cryptocurrencies. The Ontario Securities Commission (OSC) on the other hand granted regulatory relief to allow Ontario’s first regulated ICO under existing exemptions in securities laws.

And the British Columbia Securities Commission approved Canada’s first registered cryptocurrency investment fund, acknowledging that it views cryptocurrency investments as a new and novel way to invest. This ruling allowed pension, investment and venture capital funds including the Ontario Municipal Employees Retirement System’s Ethereum Capital to invest in cryptocurrencies and tokens.

This year, amid extreme market volatility, Canada’s first Blockchain exchange-traded fund began trading on the Toronto Stock Exchange. And OSC started examining the business activities of several exchanges on the concern that they were allowing trading in tokens that would otherwise qualify as securities.

Cryptocurrency taxation with incentives

The Canada Revenue Agency (CRA) began taxing cryptocurrencies in 2013, but to bolster technological and scientific innovation the –Federal and provincial—governments provide various Research and Development (R&D) tax incentives.

Laura Gheorghiu a tax partner at Gowling WLG explained that the CRA has characterized cryptocurrency as a commodity, therefore the exchange of it becomes a taxable event as a barter transaction giving rise to either business income (fully taxable) or capital gains (50% taxable)— depending on the facts and circumstances– measured according to the value of the assets exchanged in Canadian Dollars.

If a cryptocurrency is held as a capital asset (like an investment), then the gain is classified as a capital gain and taxed as such. If the cryptocurrency is situated, deposited or held outside of Canada directly or through funds, taxpayer must adhere to foreign reporting rules.

If an employee receives cryptocurrency as payment for salary or wages, or otherwise in connection with employment, the amount, computed in Canadian dollars, is included in the employee’s income. Mining of cryptocurrencies is taxed as either a business or a personal hobby (non-taxable).

Business income, wages or capital gains are taxed at the applicable tax rate for the taxpayer in question. The general combined Federal/provincial income tax rates in Canada vary between 26.5% to 30% for corporations and 44.5% to 58.75% for individuals depending on the province.

A non-resident that carries on a business in Canada, is subject to taxation under the same rules as a Canadian resident. Cross-border payments of rents or royalties in cryptocurrency to a non-resident are subject to a withholding tax of 25%, that may be reduced under an applicable tax treaty.

Personal tax returns are due at the end of April and corporate tax returns are due six months after the fiscal year-end of the corporation.

Selva Ozelli, Esq., CPA is an international tax attorney and CPA who frequently writes about tax, legal and accounting issues for Tax Notes, Bloomberg BNA, other publications and the OECD.

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#Cryptocurrency news #Bitcoin news #btcoin price today

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awesomeblockchain · 7 years ago

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If you would like to contribute an Expert Take, please email your ideas and CV to [email protected].

A study conducted by Cornell University shows that -The Ethereum nodes are both in the latency space, and also geographically, more distributed around the world, as opposed to Bitcoin nodes, which tend to be located in data centers" explained Emin G\cFCn Sirer, Cornell professor and computer scientist.

Center for Blockchain innovationCanada's dominance in Blockchain innovation stems in part from Toronto being home to Vitalik Buterin who is the inventor of the Ethereum Blockchain, a second-generation open source software platform, with a general scripting language, which created a protocol for building reliable decentralized trusted networks. It extends the functionality of Satoshi Nakamoto's Blockchain design which powered decentralized peer-to-peer Bitcoin payment, by adding the concept of smart contracts, also called scripting.

The platform has worldwide adoption. As Nick Johnson, the chief software architect of Ethereum Foundation, puts it:

-We are building a bridge between the human readability of cryptographic addresses and machine readability. While some others are working similar platforms that they feel may have their own advantages, the size of the development teams around Ethereum ballooned with initial spikes in interest to something larger than anything else in the space. With that, application development, innovation in scaling and other areas followed the trend, thereby creating a snowball effect."

Ron Resnick, Executive Director of the Enterprise Ethereum Alliance which launched last year adds:

-EEA serves as the connective tissue between Ethereum Blockchain and the evolving enterprise industry with over 450 members from all around the world -- 135 in the Banking Work Group -- which are driving production deployments through a community of over 30,000 developers."

Take for example ConsenSys, an EEA member firm, which various Ethereum projects including Quorum, and the EU Blockchain Observatory and Forum and trains Ethereum developers at its Academy.

The EEA is also a member of Blockchain Research Institute (BRI), based in Toronto, which is dedicated to over 70 research projects that proposes ways in which Blockchain technology can be utilized to impact various industries. BRI has partnered with the Information and Communications Technology Council (ICTC) of Canada to build a nationwide Blockchain ecosystem; alongside the Bank of Canada which has explored and experimented with a National miningBut it's not only Blockchain innovation where Canada excels in. According to Hydro Quebec, the province has an energy surplus equivalent to 100 Terawatt hours over 10 years and offers some of the lowest electricity rates in North America. This has drawn cryptominers to the region, including from China, in droves. A cryptominers easy, breezy life style starkly contrasts that with a gold miner who works 5,400 to 5,600 feet below surface, at suffocating temperatures, dripping with sweat, while punching holes into burning rock walls, to find hidden gold, in the dark.

Here is an example. China's Bitmain Technologies began mining in Canada in 2016, when ETH traded at $1. When ETH's price rose 63,600% to $636 with no implemented hard cap on the total ETH supply, Bitmain first announced a new specialized mining system for ETH; then set its eyes on cryptocurrency mining sites in Quebec, as it takes on average 29.05 TWh annually to operate a cryptocurrency mining operation. That's about 0.13 percent of total global electricity consumption.

While this may be potential bad news for the smaller cryptominers in the region, a local ETH miner shrugged it off:

-Quebec is one of the best places in the world for mining, thanks to low cost electricity, cool temperatures, and high-speed internet. There's a lot of data centers in Montreal and they'll rent you a space for your own server or ZTE smartphone--Sugar S11. Since you'd be paying about half to 1/3rd the electricity price of Ontario, then the added expense of rent is well worth it"

However, recently Quebec Premier Philippe Couillard warned that -Cryptominers planning to move to the region will not get cheap electricity from the government-owned utility Hydro-Quebec, as the utility may not have enough power to meet the demand." The utility has received an order to await instructions from the government.

Light cryptocurrency regulationExcessive regulation could stifle innovation; accordingly, Canada lightly regulates cryptocurrency/ICO/tokens. And offers a wide selection of government -- federal and provincial -- incentives and aid to startup tech companies.

Last year, with the boom in Ethereum Blockchain based ICOs that raised $4 Billion worldwide, the Canadian Securities Administrators suggested that Canadian Securities Law may be potentially applicable to cryptocurrencies. The Ontario Securities Commission (OSC) on the other hand granted regulatory relief to allow Ontario's first regulated ICO under existing exemptions in securities laws.

And the British Columbia Securities Commission approved Canada's first registered cryptocurrency investment fund, acknowledging that it views cryptocurrency investments as a new and novel way to invest. This ruling allowed pension, investment and venture capital funds including the Ontario Municipal Employees Retirement System's Ethereum Capital to invest in cryptocurrencies and tokens.

This year, amid extreme market volatility, Canada's first Blockchain exchange-traded fund began trading on the Toronto Stock Exchange. And OSC started examining the business activities of several exchanges on the concern that they were allowing trading in tokens that would otherwise qualify as securities.

Cryptocurrency taxation with incentivesThe Canada Revenue Agency (CRA) began taxing cryptocurrencies in 2013, but to bolster technological and scientific innovation the --Federal and provincial-governments provide various Research and Development (RD) tax incentives.

Laura Gheorghiu a tax partner at Gowling WLG explained that the CRA has characterized cryptocurrency as a commodity, therefore the exchange of it becomes a taxable event as a barter transaction giving rise to either business income (fully taxable) or capital gains (50% taxable)- depending on the facts and circumstances-- measured according to the value of the assets exchanged in Canadian Dollars.

If an employee receives cryptocurrency as payment for salary or wages, or otherwise in connection with employment, the amount, computed in Canadian dollars, is included in the employee's income. Mining of cryptocurrencies is taxed as either a business or a personal hobby (non-taxable).

Personal tax returns are due at the end of April and corporate tax returns are due six months after the fiscal year-end of the corporation.

Selva Ozelli, Esq., CPA is an international tax attorney and CPA who frequently writes about tax, legal and accounting issues for Tax Notes, Bloomberg BNA, other publications and the OECD.

https://ift.tt/2jj1Mw9

#Ingentium #Inc. - Today

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realestatedigitalsales · 7 years ago

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Real Estate - Blockchain, factory-made homes, and 'the American model': 5 fixes for Britain's broken housing market

Real Estate - Blockchain, factory-made homes, and 'the American model': 5 fixes for Britain's broken housing market

By Thomas Colson Real Estate - LONDON – Technology and changing demographics are having a huge impact on the UK housing industry, with some hopeful they can help alleviate the country's housing crisis. With these issues on the agenda, the UK's biggest property conference, ResiConf, took place last week, and Business Insider attended. The theme was fixing Britain's "broken" housing market, a phrase borrowed from the government's own white paper on the issue. Fixes are sorely needed: there is a shortage of homes across the country, and builders are consistently failing to keep pace with demand. Soaring prices and rising rents are pricing out first-time buyers and young professionals. So what can be done to address the problem? Here's what everyone was talking about at ResiConf: 1. Factory-built homes are ready to take off Much of the talk at ResiConf focused on the topic of modular housing (less fashionably called prefabricated homes). Firms like Pocket Living have made their name building affordable homes which are assembled off-site in factories around the country, then shipped on-site on a lorry. Some think they offer part of the solutions to the UK's housing crisis, especially in cities where space is short. London mayor Sadiq Khan certainly thinks so. Pocket just secured a £150 million loan from the London Mayor's office, the government, and Lloyds bank to build more than 1,000 affordable homes by 2021. The benefits? Due to the lower costs associated, Pocket is able to offer affordable homes made to a high specification at around 80% of the local market rate. The drawbacks? At 38 square feet, one-bedroom Pocket homes are roughly the size of a London underground carriage. That doesn't seem to have deterred prospective buyers: the waiting list for an affordable Pocket home stands at 35,000 at the most recent count. 2. Proptech can bring down costs and free up land Many of the sector's game-changing innovations look set to come within the proptech sector — a catch-all term for property technology. Business Insider met Land Insight, a software firm which pulls in datasets from local government and the Land Registry to help developers identify development sites cheaply and more quickly than traditional methods, which often rely on costly surveys and become bogged down in legal work. Land Insight CEO Jonny Britton said a greater volume of information would encourage building and bring down costs. In a market low on space and short on time, it is unglamorous but important changes to development such as this which could herald the biggest changes for the industry. 3. Build-to-rent – "the American model" — could represent the future Build-to-rent is a relatively new concept in the UK, with most developments historically built for sale rather than for renting. But developers have recently started to capitalise on demand for a different kind of product, and there are now 83,650 BTR homes completed or planned across the country. Living in a BTR home means living in a development designed for renters: typically it has communal spaces, amenities like gyms and swimming pools, a concierge service. Rents often include perks like Sky TV and gym membership. That means premium prices, but in the UK developments often contain quotas of affordable homes which are let at between 65 and 80% of market value (at the 7,600-home development in Wembley Park, the UK's biggest, 40% of homes are affordable.) Build-to-rent also means no letting agency fees — because you rent directly from the landlord — and typically rents of three years or more which rise only with inflation, rather than at the whim of your landlord. Institutional investors also like BTR: keeping all the properties in a building offers a steady, fixed income with a healthy yield of the kind that is attractive to pension funds and insurers. It's easy to see why the government thinks purpose-built rental blocks — which are already popular in the US, Germany, and France — could be an important fix for a market in which many simply cannot afford to buy. "The market is ready to support far more build-to-rent. Although as a concept, it is relatively new in the UK, there is an opportunity to build on lessons from the established multi-family housing sector internationally. "The US is now delivering around 300,000 multi-family homes every year, but it took them 30 years to get there," he said. "We have the opportunity to develop the sector more quickly here, by welcoming international investment and hearing from others." He outlined a £65 million loan package to build 7,000 mainly BTR homes in London. 4. Blockchain could revolutionise property sales Blockchain — essentially a tamper-proof ledger of permanently-recorded transactions — is the technology that underpins much-hyped cryptocurrency Bitcoin. Some developers are starting to let tenants pay rental deposits in Bitcoin, but blockchain's potential applications in property go further than that. Neil Singer is the founder of ClickToPurchase, a site which allows clients to exchange legally-binding contracts over the internet. It aims to put an end to the protracted and often messy months of a sales process which often results in a prospective buyer or seller pulling out from a deal without fear of financial penalties. It is the only site which offers the service, and has so far seen nearly £200 million exchanged on the platform. Singer told a ResiConf audience that blockchain would be used for increasing numbers of UK property sales in the future. ClickToPurchase is in the process of building its own Blockchain, on which its sales will be permanently recorded. "Our blockchain is actually live, in final testing, and will be openly available within a few weeks," he said. "For the first time, property sales, actual legal transactions, will be recorded in a Blockchain." 5. Rent controls are ruled out Rent controls have been a hot topic since then-Labour leader Ed Miliband pledged to cap rent rises if he was elected prime minister in 2015. He wasn't elected, but calls for rent caps have grown louder since. The Scottish government announced in April that councils would have the power to introduce rent controls, and Glasgow and Edinburgh look set to use the powers. The Conservatives will not be introducing them, however. Tory MP Alok Sharma, giving his first speech since he was appointed housing and planning minister in July, said at ResiConf rent controls were part of a "Marxist agenda" and pledged that they would not be introduced in this parliament. He said the emphasis would be on growing the number of rented homes being built and delivering the government's White Paper. “There is a lot in it for you," he told an audience of developers. "We will increase the quality and number of homes for the private rented sector." Read more Click to Post

#and 'the American model': 5 fixes for Britain's broken housing market #factory-made homes #Real Estate - Blockchain

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jamieclawhorn · 6 years ago

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Is it time to get greedy with the Sirius Minerals share price?

Share in Sirius Minerals (LSE: SXX) are down by 4% at the time of writing on Tuesday, after the firm admitted it still hasn’t secured any of the $3.6bn (£2.9bn) funding needed to complete the development of the Woodsmith polyhalite mine in North Yorkshire.

For shareholders who’ve seen the fertiliser firm’s stock fall by nearly 40% over the last six months, it’s disappointing news.

However, I expect a solution to be found, eventually. And the company is continuing to make solid progress with the construction of the related mine shafts and transport tunnel.

Could this share price weakness be the last great buying opportunity for Sirius investors?

Funding keeps slipping

Sirius needs $3bn (£2.4bn) of debt to complete the mine build. In September, chief executive Chris Fraser said that commitment letters from lenders were expected during the fourth quarter of 2018. In November, this deadline was extended to “December 2018 and January 2019.”

The company is now saying that it hopes to have “agreed commitment letters as soon as possible.”

Fraser says that the firm’s unrestricted cash balance of £230m is enough to keep construction operations going into the second quarter of 2019. Workers won’t have to down tools just yet. But the fact that this has been mentioned at all suggests to me that the timetable for financing is far from certain.

This $3bn plan has changed

Today’s update has revealed some changes to Sirius’s stage-two financing plans.

The company was previously hoping to borrow $3bn, with half of the loans guaranteed by the UK government’s Infrastructure and Projects Authority (IPA).

That’s changed. Sirius is still aiming to raise $3bn from lenders, but the cash will be released in three stages. Each of these will be dependent on a certain set of construction milestones being completed.

The IPA-guaranteed debt will be the last to be released. This should reduce the risk to the taxpayer as, by then, Sirius expects to have started selling POLY4 fertiliser to commercial customers. However, I suspect this approach will increase the cost of the first and second stages of funding, which won’t be protected by government guarantees.

What about the extra cash?

Back in September, Sirius said that an extra $400m-$600m would now be needed to complete the build, on top of the $3bn originally planned.

Today’s update didn’t provide any further information on where this extra cash will come from. However, the company has repeatedly ruled out borrowing this money.

I expect that the extra funding will come from shareholders, either directly or through some kind of partnership deal with an outside investor. In either case, this seems likely to be dilutive for existing shareholders.

The right time to buy?

I think that Sirius will eventually secure the funding it needs. But I expect the costs will be higher than expected. This could reduce future shareholder returns.

At the last-seen share price of 22p, Sirius equity is still valued at £1bn. That seems high enough to me. It’s still nearly three years until production is due to start, and the project is currently unfunded.

I continue to see Sirius Minerals as speculative and quite risky. For me, it’s one to avoid.

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