Pension need to knows Official MSE Guide Discussion

MallyGirl

if your employer offers salary sacrifice as a way of contributing to your pension then you benefit from the reduction in NI.

jonon

Is there any way as self employed to get a reduction in NI with your pension?

dunstonh

jonon wrote: »

So if you contribute £800 the government add 25%?

20% tax relief does effectively mean it is 25% when you describe it that way. However, it is a tax relief. Not a bonus. So, it should be referred to as gross.

If you're employed do so save on no NI contribution on your pension payments?

Depends on how you make the contributions. An employer may offer salary sacrifice and this can lower then NI. If the employer does not offer this, then it will not. Personal contributions won't reduce NI either.

Is there any way as self employed to get a reduction in NI with your pension?

yes.

jonon

How do your pension contributions reduce your NI if self-employed?

dunstonh

jonon wrote: »

How do your pension contributions reduce your NI if self-employed?

It is done via the tax return. Effectively, you have a lower income because of the pension contribution.

Much the same way that pension contributions can increase tax credit s and return child benefit for those earning over £50k a year.

greenglide

Is there any way as self employed to get a reduction in NI with your pension?

You can always stop being self employed and set up a limited company instead.

There are pros and cons to this.

andy5241

Hi I'm 62 and looking to retire shortly, I currently have around £150,000 in a defined contributions plan held with Zurich, but they're now in the process of changing everyone over to a Corporate Savings Platform so I have 2 plans running at the moment. Then by the end of next year the DC will be closed and moved to the CSP. Question is: should I take the benefits from the DC before the end of next year and if I did where's best to get information on Drawdown Providers.

dunstonh

andy5241 wrote: »

Hi I'm 62 and looking to retire shortly, I currently have around £150,000 in a defined contributions plan held with Zurich, but they're now in the process of changing everyone over to a Corporate Savings Platform so I have 2 plans running at the moment. Then by the end of next year the DC will be closed and moved to the CSP. Question is: should I take the benefits from the DC before the end of next year and if I did where's best to get information on Drawdown Providers.

Insufficient information to answer that. There are multiple ways of doing things and the best way is the one that fits your circumstances, tax position and objectives. None of which we know.

delves60

hi i am 57 years old i have a pension and i wanted to take some money out now but my pension people said i had to have a pension of £50,000 if i wanted to take money out now . My pension is £17,000 on a g.m.p is this right what thay said or is it how thay work thanks

Silvertabby

delves60 wrote: »

hi i am 57 years old i have a pension and i wanted to take some money out now but my pension people said i had to have a pension of £50,000 if i wanted to take money out now . My pension is £17,000 on a g.m.p is this right what thay said or is it how thay work thanks

If your pension is mostly GMP (the amount the pension fund has to pay you) then they can withold payment until you reach GMP age. That's currently still 65 for a man and 60 for a woman.

I assume that £17K is the value of your 'pot', and not your annual pension?