Community Chest

Community Chest Business Loans Limited (“Community Chest”) is a specialist ThinCats sponsor dealing only with unsecured loans that qualify for tax relief1. Community Chest Loans are not secured because this is a condition of attracting the tax relief.

Community Chest was launched in July 2016 by the ThinCats founder directors Kevin Caley and Peter Brown with the support and encouragement of ThinCats but as an independent company.

Kevin Caley & Peter Brown have a long history of involvement with community funding including organising the national conference for the Community Development Finance Association for three years running and managing the UKs second community development venture capital fund. In 2003 Kevin was joint author of a DTI sponsored guide to establishing a local community development funding project. They and ThinCats see Community Chest as an opportunity to help fellow investors ‘put something back’ whilst also earning a return on their investment.

ThinCats members who are considering loans sponsored by Community Chest should understand that these loans are different from the secured loans normally found on the ThinCats platform and should make sure that they understand the very different risk adjusted rate of return.

Advantages

  • Lenders get attractive tax relief to compensate for the lack of security.
  • An opportunity to earn a return on your investment whilst also supporting a worthwhile project.
  • The income is mainly in the form of tax relief which reduces your tax bill rather than increasing your taxable income.
  • The limit on how much you can invest depends on how much tax relief you can claim. That is only limited by how much tax you pay.

Disadvantages

  • Only UK tax payers can claim the tax relief.
  • Your capital is tied up for 3 or 5 years with no possibility of selling on the ThinCats secondary market.
  • If you, or the borrower, cease to qualify for tax relief during the term of the loan you may lose some or all of the tax relief.

Please visit the Community Chest website to find out more about the two distinct types of Community Chest loans and two different types of tax relief.


 

[1]Tax treatment depends on your individual circumstances and may be subject to change in the future. Tax relief depends upon both the borrower and the lender qualifying and continuing to qualify throughout the life of the loan. The Community Chest website has detailed information on qualification.