Starting a pension in Ltd company

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garybarlowsbeard
garybarlowsbeard Posts: 368 Forumite
in Pensions, annuities & retirement planning
Hi

Apologies if I'm doing the annoying thing of starting a new thread when not needed but the circumstances are fairly specific.

I own 50% of am limited company and don't have any pension. My co-director and owner has a stakeholder pension with Aviva from a previous job.

We want to start a pension and I believe the most tax-efficient way is for the company to make direct contributions. We would want to vary these but with around £100-£200pm each on average.

We just want something with very low charges, that is flexible in terms of the amount and happy with relatively high risk as we are both (relatively!) young (38).

He is happy to keep with his stakeholder plan but also happy not to if we both had to do the same thing.

Any thoughts or comments appreciated. We are around the threshold of higher rate tax but suspect that will drop a little unfortunately in the coming years.

Cheers,
GBB
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  • dunstonh
    dunstonh Posts: 116,387 Forumite
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    Any individual personal pension will fit that objective.

    Your personal tax situation is irrelevant in your case as you do not get personal tax relief. The company gets the relief as the corporation tax bill is lowered as the pension is a business expense.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • xylophone
    xylophone Posts: 44,427 Forumite
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    http://www.taxcafe.co.uk/pensionmagic.html

    might be worth a read.
  • Alexland
    Alexland Posts: 9,653 Forumite
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    edited 13 September 2017 at 9:25PM
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    I have recently taken out an Aviva stakeholder for my wife (via Cavendish as you cannot buy direct) and am very happy so far.
  • System
    System Posts: 178,094 Community Admin
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    Remember that company contributions are not limited by your salary, but only by the annual allowance plus any carry-forward. So the company could make a large lump-sum contribution, which would automatically be treated as a company revenue expense even if paid out of a capital reserve, or in specie property.
    Company tax relief is not limited to the actual tax paid in one year, but can be carried forward to offset future profits.
  • garybarlowsbeard
    garybarlowsbeard Posts: 368 Forumite
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    xylophone wrote: »
    http://www.taxcafe.co.uk/pensionmagic.html

    might be worth a read.

    Might it be worth almost £30? Are you connected with it by any chance?
  • garybarlowsbeard
    garybarlowsbeard Posts: 368 Forumite
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    So would a stakeholder pension be a good choice? Seems like it to me. Also, in the event of my death, would me wife get the pension or the pot?

    Cheers again!
  • xylophone
    xylophone Posts: 44,427 Forumite
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    Are you connected with it by any chance?

    No - but it would appear to answer your questions.

    Have a look at the contents page.

    http://www.taxcafe.co.uk/samples/magsample.pdf

    From a previous edition (but the information is not up to date)

    http://www.taxcafe.co.uk/resources/companyowners_pensioncontributions.html
  • dunstonh
    dunstonh Posts: 116,387 Forumite
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    garybarlowsbeard wrote: »
    So would a stakeholder pension be a good choice? Seems like it to me. Also, in the event of my death, would me wife get the pension or the pot?

    Cheers again!

    We know nothing about you or how you want to exist or the amounts involved or how you want to buy it. So, you havent given much to narrow down the options. A stakeholder is one of those options. Stakeholders are rarely the best (typically only children pensions or very small contributions) but they are an option.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • garybarlowsbeard
    garybarlowsbeard Posts: 368 Forumite
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    Looking at this list:

    http://www.money.co.uk/pensions.htm

    Ones that list the fees as zero, what's that all about?!
  • garybarlowsbeard
    garybarlowsbeard Posts: 368 Forumite
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    dunstonh wrote: »
    We know nothing about you or how you want to exist or the amounts involved or how you want to buy it. So, you havent given much to narrow down the options. A stakeholder is one of those options. Stakeholders are rarely the best (typically only children pensions or very small contributions) but they are an option.

    I have mentioned some of that info I think.

    I'm 38, looking to invest around £200pm at the moment with some flexibility. Happy to have high risk at this stage (and I do understand risk - I think!). I will be buying it through a limited company.

    Thanks for your time and if there is anything else that will help you give me general advice let me know.

    Bob
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