Limited Company - Pension Contribution

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Arnos
Arnos Posts: 6 Forumite
in Pensions, annuities & retirement planning
I am single, 51yrs old IT contractor with a limited company( on 40% tax band).

I have a personal pension with Scottish Life (£50k) and currently contributing £400 monthly. I also fully fund my SS ISA (with Cavendish Online currently at £49k). My cash ISA from previous years is with Nationwide (£46k) and earning a pitiful 1.5%. My mortgage is at £70k and hoping will be fully paid in 5 yrs.

I have excess money in my limited company (£70k) and can either top up my personal pension or open a new one (a SIPP perhaps?). My job is stressful and I may not have the bandwith to monitor a SIPP on a regular basis. Any recommendations as to where I can invest my excess cash so I can use this as part of my pension in future?

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  • dunstonh
    dunstonh Posts: 116,635 Forumite
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    I have a personal pension with Scottish Life (£50k) and currently contributing £400 monthly.

    Hopefully as an employer contribution and not a personal contribution.
    Any recommendations as to where I can invest my excess cash so I can use this as part of my pension in future?

    Anything wrong with Scottish Life? Big provider and market leader (UKs biggest provider of income drawdown for example). Contact options are very good. Especially for the disinterested investor. Their contracts since around 2005 onwards have been very well priced.
    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.
  • Arnos
    Arnos Posts: 6 Forumite
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    I'm contributing to my pension personally (not thru my limited company) actually.
  • tony4147
    tony4147 Posts: 340 Forumite
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    You should be paying through the LC, get you tax and NI liabilities down
  • atush
    atush Posts: 18,730 Forumite
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    You should pay thru your company- have you got an accountant?

    He can explain the ramifications for your company of A- lowering your personal tax paid and also B, lowering your corporation tax paid as both the pension contrib is deductible, plus your company saves NICs too.

    Win win, win.
  • System
    System Posts: 178,103 Community Admin
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    Also employer contributions are not limited by your annual salary, only by the overall annual limit, with 3 years carry forward of unused allowances.

    To get corporation tax relief the payments simply have to be legitimate business expenses, which is easy to justify if you are a director.
  • Arnos
    Arnos Posts: 6 Forumite
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    Thanks all. Will get in touch with my IFA to move my personal contributions to be via my limited company.
  • xylophone
    xylophone Posts: 44,601 Forumite
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    http://www.hl.co.uk/pensions/sipp/how-much-can-i-invest/employer-contributions
    might be worth a read.
  • innovate
    innovate Posts: 16,217 Forumite
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    Ridiculous claims by GarryPBaker. Reported.
  • atush
    atush Posts: 18,730 Forumite
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    Thanks, been reporting him all day lol
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