Don't invest unless you're prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong.
Risk Summary

Estimated reading time: 2 min

Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.

What are the key risks?

  • You could lose all the money you invest
  • Most investments are shares in start-up businesses or bonds issued by them. Investors in these shares or bonds often lose 100% of the money they invested, as most start-up businesses fail.
  • Checks on the businesses you are investing in, such as how well they are expected to perform, may not have been carried out by the platform you are investing through. You should do your own research before investing.

You won't get your money back quickly

  • Even if the business you invest in is successful, it will likely take several years to get your money back.
  • The most likely way to get your money back is if the business is bought by another business or lists its shares on an exchange such as the London Stock Exchange. These events are not common.
  • Start-up businesses very rarely pay you back through dividends. You should not expect to get your money back this way.
  • Some platforms may give you the opportunity to sell your investment early through a 'secondary market' or 'bulletin board', but there is no guarantee you will find a buyer at the price you are willing to sell.

Don't put all your eggs in one basket

  • Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well. A good rule of thumb is not to invest more than 10% of your money in high-risk investments. Learn more here.

The value of your investment can be reduced

  • If your investment is shares, the percentage of the business that you own will decrease if the business issues more shares. This could mean that the value of your investment reduces, depending on how much the business grows. Most start-up businesses issue multiple rounds of shares.
  • These new shares could have additional rights that your shares don't have, such as the right to receive a fixed dividend, which could further reduce your chances of getting a return on your investment.

You are unlikely to be protected if something goes wrong

  • Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker.
  • Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated platform, FOS may be able to consider it. Learn more about FOS protection here.

If you are interested in learning more about how to protect yourself, visit the FCA's website here.

For further information about investment-based crowdfunding, visit the crowdfunding section of the FCA's website here.

Weekly Briefing: UK house prices to increase in H2 of 2024, Local tech firm secures SpaceX deal, Potential tax changes & BoE rates decision
Weekly Briefing

Weekly Briefing: UK house prices to increase in H2 of 2024, Local tech firm secures SpaceX deal, Potential tax changes & BoE rates decision

Weekly Briefing: UK house prices to increase in H2 of 2024, Local tech firm secures SpaceX deal, Potential tax changes & BoE rates decision
7:26

In this week's briefing we’ll cover new data from Zoopla suggesting a 2% house price increase by the end of 2024,  Filtronic’s second deal with SpaceX in aid of Project Starlink & increasingly likely Capital Gains and Inheritance Tax increases under the new Labour government & Bank of England rates decision.


UK Economy

BoE Rates decision

  • The Bank of England (BoE) has decided to ease monetary policy following a drop in inflation back to its 2% target in May and June this year, marking the first time it has lowered interest rates since the emergency rate cut in March 2020.

  • Interest rates had previously been raised from 0.1% in December 2021 to 5.25% by August 2023, maintaining this level for the past year.

  • Today’s rate cut should begin to ease some of the pressure on UK borrowers, the timing of which will depend on how long banks take to pass these lowered rates on to consumers and businesses.


UK Business

Filtronic's New Contract with SpaceX

  • Filtronic, a local telecoms tech firm based in Sedgefield and Leeds, has secured a $9 million contract from SpaceX to support the Starlink satellite project, continuing Filtronic's involvement in providing crucial technology for SpaceX's internet satellite constellation.

  • The contract involves Filtronic's E-band solid-state power amplifier (SSPA) modules, which are essential for the Starlink system to deliver high-speed, low-latency internet globally.

  • This new agreement follows a substantial £48 million ($60 million) deal struck in April between Filtronic and SpaceX, which included the potential for SpaceX to become a shareholder in Filtronic.

  • As part of the latest order, an additional 2,171,211 share warrants have been vested, bringing the total to 8,684,844 share warrants, representing 4% of Filtronic's share capital at the time of the agreement.

  • Nat Edington, Filtronic's CEO, expressed delight at the continued partnership with SpaceX, emphasising their significant role in supporting the rollout of the Starlink constellation. The order demonstrates the ongoing demand for their high-quality components.

  • In announcing the original agreement, Mike Nicolls, SpaceX's VP of Starlink Engineering, praised Filtronic as an "outstanding" supplier, highlighting the company's ability to meet Starlink's rigorous demands for high-quality parts.

  • The partnership could also lead to the development of new products specifically designed for the Starlink system, which aims to provide internet access to remote and underserved areas worldwide.


UK Tax

Potential Changes to Inheritance and Capital Gains Taxes

  • The Labour government, led by Prime Minister Keir Starmer and Chancellor Rachel Reeves, is poised to implement significant changes to inheritance tax (IHT) and capital gains tax (CGT) in the forthcoming autumn Budget, scheduled for 30 October 2024.

  • Potential changes to IHT include reducing gifting allowances, which would lower the amounts individuals can pass on to their heirs tax-free. Additionally, the £325,000 nil-rate threshold, which has not been adjusted since 2009, may be cut further.

  • Another proposed change involves eliminating the £175,000 main residence allowance, which currently reduces IHT due when passing on a family home to children or grandchildren.

  • Chancellor Reeves is considering imposing CGT on death in addition to IHT, effectively subjecting families to both taxes. This move could raise the effective taxation rate to as high as 54.4%.

  • The Office of Tax Simplification (OTS) had previously recommended removing the CGT "death uplift," which currently spares beneficiaries from paying CGT on inherited assets' gains. This proposal, which was initially prepared for former Chancellor Jeremy Hunt, now presents a tax-raising opportunity for the Labour government.

  • The government is also exploring the possibility of aligning CGT rates with income tax rates. The top CGT rate is currently 28%, whereas the top income tax rate is 45%. Equalising these rates has the potential to raise over £15 billion

  • Another option on the table is reducing pension tax relief for middle-class workers. This measure could involve introducing a 30% tax on pension contributions, raising an estimated £2.7 billion annually.

  • In her upcoming speech, Rachel Reeves is expected to declare Britain "broke and broken," highlighting the severe financial challenges inherited from the previous Conservative government. She is also expected to outline the necessity of difficult fiscal decisions to address a £20 billion deficit in public finances.

  • The possibility of increases in capital gains tax and inheritance tax is very real, posing a significant threat to hundreds of thousands of investors looking to sell stocks, property, cryptocurrency, and other assets. To mitigate these potential tax burdens, investors should consider more tax-efficient options, such as the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS).


UK Property

UK house prices to increase in H2 of 2024, say’s Zoopla

  • According to Zoopla, house prices in the UK are expected to increase by 2% in the second half of 2024, driven by more people selling their homes. This positive outlook comes as the number of home sales agreed in the four weeks to 21 July was 16% higher than the same period last year, with estate agents having more homes for sale than at any time in the past six years.

  • Buyers are now paying an average of 96.8% of the asking price, the highest percentage in 18 months, equating to properties selling for about £16,600 below their asking price in June 2024.

  • Recent data from the Bank of England showed that net mortgage approvals remained largely unchanged in June, reflecting a stable property market ahead of the general election and an upcoming interest rate decision.

  • The Bank of England's interest rate decision will significantly impact the market in the short term, with rates cut, this could create some positive growth.

  • Richard Donnell, an executive director at Zoopla, said: “The housing market is starting to heat up after a stone-cold 2023. There are clear signs of growing confidence among buyers and sellers with many more homes for sale and buyers paying an increased proportion of the asking price.”

  • “The Bank of England will have more impact on the market in the short term,” he said.

Final Note

This week's headlines highlight some major tax changes that could potentially be coming our way, forcing investors to take action. 

On a more positive note, we have a strong indication that property prices will continue to rise into the second half of 2024 in light of the recent rate cuts.

Additionally, it's encouraging to see UK businesses, like Filtronic, securing significant contracts with companies such as SpaceX, showcasing the UK's strong position in technology and innovation.


At GCV, we remain committed to providing the latest insights into the investment and wider economic landscape in order to support investors in making well-informed decisions when choosing where to allocate their capital.

If you would like to find out more about a number of tax-efficient investment strategies available to UK investors, discover our range of downloadable resources here.

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