As I have just discovered that as a US citizen my recently opened Stocks and Shares ISA was a terrible mistake I am looking for some other investment for my GBP savings.
With instant access savings rates so low I was looking at some peer to peer lenders. Eg Ratesetter have a system that appears to look like an instant access savings account.
How are these treated by the IRS? Can I treat it as a normal savings account, putting it on an FBAR and declaring any interest received in the normal way?
What about one like Funding Circle which looks less like a savings account? (I think you chose the companies to lend to)? Here interest is paid gross - for HMRC defaults are not deductable so you pay the full tax. Would this complicate the US return or, if they have the same policy, I could just declare the same gross return?
Any advice appreciated.
