My Investments 05/2022 (20% Withholding Tax on P2P?)

A lot has happened in May, so we have a ton of stuff to talk about in this monthly update.

Here are some of the events:

• Mintos finally launched regulated P2P loans in the form of notes, while introducing a withholding tax on interest payments. I already got mine reduced, I’ll show you how to do that as well.
• Bondora launched Go & Grow Unlimited at double the interest rate they had planned originally
• I attended the Invest 2022 fair in Stuttgart, where I finally got to meet up with old friends of mine, other German finance bloggers and the teams from Lendermarket and Bondster
• The stock market correction is far from over, and my ETF reached a new year-to-date low about two weeks ago, while luckily recovering a bit since then
• And let’s not even talk about crypto. Ok, who are we kidding, we’re still gonna talk about it.

As usual, you’ll see how each of my investments performed in May and find out which one has been performing the best so far this year.

Please don’t forget that none of this is investment advice, just my personal opinion based on my own experience as an investor.

Let’s actually start with some personal news. Don’t worry, we’ll get to my investments, the reason why you’re here, in a minute.

We’re moving!

If you’ve read my post two months ago, you probably know my wife is pregnant. As a result, we’ve been looking for a larger apartment.

I’m happy to say that we found what we believe to be the perfect apartment in another nice area in Vienna, with two additional rooms.

We’re planning on moving in in July, but there’s obviously still a lot of work to do.

This also means we won’t have too much money readily available to invest for the next 1-2 months, as we want to keep a comfortable cash buffer for renovations, apartment transfer fees and new furniture.

Invest 2022 – Meeting Lendermarket & Bondster

The second personal news is that I attended the Invest 2022 fair in Stuttgart, Germany for the first time. It felt great to finally speak again face to face with other investors, old friends of mine and other finance bloggers.

For me it was more of a networking event, I didn’t really care too much about the presentations at the event.

I got to meet the Lendermarket team, namely Endrik Eller (CEO), Tõnis Vahesaar (Legal) and Melita Raulinaityte (Marketing), as well as Laura, who I usually communicate with via e-mail regarding anything new surrounding the platform.

I really enjoyed our interactions, and it was great to talk to the people behind Lendermarket in person.

That being said, the price for the nicest booth has to go to the Czech P2P lending platform Bondster. They were right next to the blogger’s lounge, had comfy chairs and a table to relax at and they had the best coffee at the event.

I was very happy that they decided to attend the event as well. I got to meet the CEO Pavel again, who I first met a few months ago in Vienna, and talk to other Bondster employees like Markéta for the first time face to face.

And no, neither of the two platforms paid me to say any of this. I was just happy that they were there and I would have enjoyed the event a lot less without them!

If my wife and my upcoming child let me, I’d love to attend the event again next year.

P2P Lending

Ok, enough chit chat, let’s get to my investments. This time, let’s start with P2P lending.

Mintos Notes and the Withholding Tax

• Income (May 2022): 30,08€
• IRR: 11,07%
• Invested since: 27.09.2018

As I mentioned in the introduction, Mintos finally launched notes, so we’re now able to invest into bundled loans in the form of regulated financial instruments on the platform.

Investors in notes are also protected by the Latvian investor compensation scheme, up to a max. of 20.000€/investor.

However, it’s important for you to understand, that this only covers the platform risk, meaning for example Mintos not being able to provide investment services any more.

The actual risk of your investments in P2P loans remains pretty much the same as before, so if a lending company goes bankrupt and can’t fulfill its obligations to investors, you can still lose money. This is not covered by the investor compensation scheme.

Sadly, there is one downside to the new regulations by the FCMC in Latvia, and that is that Mintos had to introduce a whopping 20% withholding tax on the interest that is paid out to investors in notes.

But, you can and should get this reduced to the double tax treaty rate of the country you live in, which for most countries is 10%.

To do that, first check your email. You should have received an email from Mintos on May 20th containing the tax withholding information. In it, you’ll find a link where you can upload your tax residency certificate, which needs to contain your first and last name, personal ID and the current tax year.

I’m based in Austria, and I was able to quickly download a file containing all the necessary information on Finanzonline for the current year. Mintos accepted it and reduced my withholding tax rate to 10%:

Hopefully, it’s just as easy for other European countries. Otherwise, you might need to reach out to your local tax authorities to get the necessary proof of your tax residency, which understandably, could be a bit of a pain in the ass.

So, here’s what this withholding tax actually means, just to give you a better idea:

Let’s say you invest 1.000€ into notes on Mintos, paying 12% interest per year. Now, based on the interest rate, you would previously have expected to receive 120€ in interest per year. But now, because of the 10% withholding tax, you actually only receive 108€ in interest, so 90% of the amount.

That’s because you paid 10% in taxes on your earnings in Latvia, where Mintos is based.

However, when filing your tax returns in your home country, you’ll be able to count these pre-paid withholding taxes against your yearly earnings from P2P lending, so the total amount of taxes you need to pay on earnings remains the same.

The only downside is that you lose out on a bit of compounding on the platform itself.

The good news is that Mintos and Twino are currently working with regulators to get this rate reduced to 5%, and there’s a very high chance that this change will be implemented within the next 2-3 months, without the need to upload documents beforehand.

To get a better feeling of how these new loans work, I also invested into my first set of notes by the lending company Delfingroup a few days ago.

That being said, sadly my funds in recovery have not changed at all on the platform.

Viainvest – Higher Interest, Bonus Campaign and Data Leak

• Income (May 2022): 30,21€
• IRR: 11,99%
• Invested since: 11.10.2019

Interestingly, another regulated p2p lending platform in my portfolio Viainvest, has not announced a general withholding tax on its loans yet. It’s possible that they’re waiting for the rate to get reduced to 5% for all investors before implementing it, which is probably a smart move.

Speaking of Viainvest, there were both good and bad news recently.

Let’s start with the bad stuff:

Apparently, a Viainvest support employee caught a virus, which he received through a support conversation with an investor. Then, a hacker (or bot) gained access to some of the email addresses from investors he had been in contact with via support tickets.

As a result, a few investors received an email like this, containing a zip file:

Luckily, it was not sent by Viainvest, but some random foreign e-mail address, so they were clearly phishing emails. Nonetheless, I hope no one opened the zip file or got scammed in any way.

After a thorough investigation, Viainvest confirmed that the website and database were not affected and that investors funds are safe.

Alright, now on to the good news:

In line with the rest of the P2P market right now, Viainvest also increased its interest rates. All new consumer loans now pay 12% interest/year, up from 10-11%.

Make sure you update your auto invest settings to a minimum of 12% per year, so you only pick up the new loans with the higher interest rate. I already updated mine:

In addition, Viainvest is running a 1% cashback campaign for all investments made via the platform’s auto invest until the 10th of June (conditions here).

• Get a 10€ signup bonus on Viainvest via my link.

Lendermarket

• Income (May 2022): 37,24€
• IRR: 14,39%
• Invested since: 21.11.2019

Robocash

• Income (May 2022): 37,17€
• IRR: 12,27%
• Invested since: 19.01.2021

May was my highest earning month on Robocash so far.

• Sign up using this link, to get  1% cashback on all of your Robocash investments after 30 days.

Iuvo Group

• Income (May 2022): 17,02€
• IRR: 11,35%
• Invested since: 05.10.2018

Bondster

• Income (May 2022): 17,11€
• IRR: 10,55%
• Invested since: 25.01.2022

Income Marketplace

• Income (May 2022): 11,56€
• IRR: 11,33%
• Invested since: 17.03.2022

Crowdestor

• Income (May 2022): 12,73€
• IRR: 7,91%
• Invested since: 03.04.2019

I’m still withdrawing any funds I receive on a monthly basis from Crowdestor. Steer clear of this platform, it’s not worth the trouble.

Bondora Go & Grow Unlimited – My Thoughts

• Income (May 2022): 21,54€
• IRR (incl. withdrawals): 6,69%
• Invested since: 01.09.2018

Bondora launched its new Go & Grow unlimited investment strategy. The good news is that after hearing investors feedback, they doubled the interest rate from 2% to 4% and that there are no limits to how much money can be added on a monthly basis.

I still wish they would have removed the monthly 400€ limit on the normal Go & Grow instead, as it still pays 6,75% per year.

However, one could now in theory park some cash on Go & Grow unlimited and earn 4%, while moving 400€ per month over to Go & Grow for the 6,75% interest rate.

Both investment products still come with the unique benefit of being able to withdraw your funds at any time under normal market conditions.

Bondora also published its financial statements for 2021, which were audited by KPMG:

The Bondora Group remained profitable for the 5th year in a row, generating a healthy net profit of 6,7 million euros last year.

• Get a 5€ bonus on Bondora when you sign up via my link and invest 10€ or more.

Why I Left EstateGuru

• Income (May 2022): 2,26€
• IRR: 7,99%
• Investment date: 12.10.2020 – 19.05.2022

My last remaining loan on EstateGuru was fully paid back in May and I now completely exited the platform.

Before you ask, I actually think EstateGuru is one of the best players in the P2P lending space. I have zero complaints about my experience as an investor, apart from the 1€ withdrawal fee.

However, it just doesn’t fit into my portfolio right now, which is complex enough already. I also don’t want to spend time manually selecting loans for 9-10% interest per year.

But who knows, I might be back in the future.

My Income From P2P Lending in May

Platform	Income	IRR	Invested	Value
Mintos	30,08€	11,07%	3.353€	6.092€
Crowdestor	12,73€	7,91%	4.758€	6.063€
Lendermarket	37,24€	14,39%	2.513€	3.540€
Viainvest	30,21€	11,99%	2.737€	3.501€
Iuvo Group	17,02€	11,35%	1.562€	2.802€
Robocash	37,17€	12,27%	3.250€	3.722€
Bondster	17,11€	10,55%	2.000€	2.071€
Income	11,56€	11,33%	1.500€	1.550€
Bondora Go&Grow	21,54€	6,69%	3.400€	3.893€
EvoEstate	0€	6,71%	214€	300€
EstateGuru	2,26€	7,99%	0€	0€
Total	216,92€		25.287€	33.534€

I earned a total of 231,99€ from P2P lending in May.

According to Portfolio Performance, the free tool I use to track my investments, that’s a return of 0,65% for the month and an internal rate of return of 8,57% p.a. from P2P lending in 2022.

ETFs

Ok, shall we move on to the stock market?

My wife and I kept buying our main ETF, the accumulating Vanguard FTSE All-World (ISIN: IE00BK5BQT80, Ticker: VWCE) via our monthly savings plan and I tried to buy the dip with some extra cash until the middle of May.

But, due to the upcoming costs for our new apartment, we’ll sadly have to put our monthly ETF purchases on hold for the next 1-2 months.

Here’s how our main ETF performed (in €):

• -1,46% in May
• -7,59% from January 1st – May 31st, 2022

At one point in May, our ETF portfolio was actually down 14,67% for the year, but luckily it recovered a bit since then.

This is part of the game and why ETFs are long-term investments.

Nobody can successfully predict how the market is going to move on a monthly basis. But the period we’re going through right now could represent a good buying opportunity.

If you’re looking for the best, low-cost brokers in Europe to get you started on your investment journey into stocks or ETFs, I recommend checking out Interactive Brokers and Degiro.

And if you’re based in Austria or Germany, where taxes are more complicated, make sure you check out my favorite local brokers here. These take care of everything for you, making your life a lot easier.

• ETF Investing for Europeans in 2022 (Incl. Broker Tutorials)

Bitcoin & Ethereum

Let’s talk about the most speculative 10% of my investment portfolio, which now definitely reached bear market territory:

Bitcoin:

• -17% in May
• -30% so far in 2022

Ethereum:

• -30% in May
• -45% so far in 2022

If you’re a crypto investor like me, this is the moment were you stop looking at your digital asset portfolio on a daily basis and focus on other things. That’s what I learned last time this happened, from 2018-2020.

Since prices already crashed, now would be the wrong time to sell anyway, in my personal opinion.

However, this could be a good time to build a small position in Bitcoin or Ethereum, if you were planning to add these two assets to your portfolio at some point.

Crypto Lending and Card Changes

Speaking of crypto, I earned 58€ from cypto lending via FTX last month.

And until June 3rd, I received a total of $58,26 in CRO cashback using my Ruby Steel crypto.com debit card.

Sadly Crypto.com lowered the cashback rate for new ruby steel cards to 1%, while mine will stay at 2% until my CRO stake runs out in about three months. At that point, I’ll either re-stake at the new rate or look into some alternatives.

And that wraps it up for my investments in May! How is your portfolio holding up?

My Investments in 2022 (May) – The Video

You might enjoy these posts:

• ETF Investing for Europeans in 2022 (Incl. Broker Tutorials)
• My TOP 3 Investments For 2022 (Yearly Returns & Outlook)
• Viainvest – 2 Years Later
• The Stock Market is Crashing – What Now? (ETF Investor)
• Lendermarket – 2 Years Later