Ltd Company Pension

PennyPurple

I am in the process of setting up my own Limited Company for the first time as I am going to take a contract position from later this month.

I understand that I can take pension contributions out of my company's gross income so that I don't have to pay any tax or NI on it.

My question is, can I put this into a regular SIPP (e.g. Hargreaves Lansdown) opened in my own personal name or does it have to be any special type of pension? I assume if a SIPP is allowed I'd have to tell them it's out of gross income so they don't try to get the top-up from the government that a normal pension contribution from someone paying out of taxed income would have to pay?

I'd be particularly interested if, as well as anecdotal information, anyone knows of any official web site that makes reference to this (I'm just being cautious as I'm keen to ensure I do it correctly).

Thanks in advance,
PennyPurple

PennyPurple

Thanks racingsantasdeer.

I understand that the most tax efficient way to do it is to make an employer contribution out of the Ltd Co's gross income, same way my (low) salary will come out, and only after those are deducted would I then pay corporation tax on the remaning profit.

I was just hoping to read somewhere 'official' that it is acceptable in this circumstance to make employer contributions into a normal SIPP held in my personal name rather than the company name. I heard somewhere (I forget where now) that I would have to set up a company pension scheme.

Yes I have done my homework on IR35, but thanks for the heads up. Fortunately the type of work I am doing falls outside IR35.

Regards,
PennyPurple

ffacoffipawb

PennyPurple wrote: »

I am in the process of setting up my own Limited Company for the first time as I am going to take a contract position from later this month.

I understand that I can take pension contributions out of my company's gross income so that I don't have to pay any tax or NI on it.

My question is, can I put this into a regular SIPP (e.g. Hargreaves Lansdown) opened in my own personal name or does it have to be any special type of pension? I assume if a SIPP is allowed I'd have to tell them it's out of gross income so they don't try to get the top-up from the government that a normal pension contribution from someone paying out of taxed income would have to pay?

I'd be particularly interested if, as well as anecdotal information, anyone knows of any official web site that makes reference to this (I'm just being cautious as I'm keen to ensure I do it correctly).

Thanks in advance,
PennyPurple

Do you like cauliflower cheese?