New pension advise.

Rollingonandon

Hi, I'm a self employed sole trader. I've  a pension with Prudential. The pension stopped when I was 60, 4 years ago. Prudential told me I cannot put any money into pension. So i will be moving it. I will have to start a new pension elsewhere. 
If I start a new pension by paying my wages from this year. 2020- 21 my accounts won't be done in time to get an accurate figure. So it would be a bit of a guess. Or do I do it from 2019-20 where the figures are done?
The first £12500 of earnings are tax free. Will the I have 20% added to that. To claim the tax relief on this year's earnings what is the cut off date to have it done by.
I want to invest in a platform that I can buy into there ready made portfolios. The total funds to invest will be about £110000 including my prudential pension. Which platform do you think would be best.
My wife has no private pension. If she started a pension with her earnings for this year which is about £15000. With probably no further contributions. Is that worth doing as I'm only thinking about the government 20% tax relief. Thanks 

Rollingonandon

Sorry if ive explained it wrong. Sole trader. 

Linton

If you havent got your final accounts you will have to guess your earned gross income I am afraid.  There is no way around that, so guess low.

You actually pay in 80% of the required contribution.  HMRC then automatically (ie you dont need to claim) add the missing 20% straight into your pension. So yes you do get 20% tax relief even if you had not paid any tax.  Not a bad deal but not quite as good as it may seem as you could have to pay 20% on 75% of the pension when you withdraw the money.  

I will leave the choice of platform to others.

Dazed_and_C0nfused

Sorry post got messy.
If you are just a sole trader and no job (wages) then you will need to estimate what you can contribute, what happened in 2019:20 isn't relevant.
The amount added is 25%, not 20%.  You pay 80% of what you want to contribute and the pension company adds the tax relief, for example you pay £4,000 and they add £1,000 tax relief.  £5,000 x 20% = £1,000.
You don't have to have paid £1,000 in income tax, but you must have profits of £5,000 to contribute £5,000 (gross). 

Rollingonandon

So if i want to have £20000 into a new pension.£16000 from me. £4000 from Gov. Would it be ok to start a pension like this. And then add my prudential pension later. What date would i need it sorted out by make use this year's government contribution.

Albermarle

The pension stopped when I was 60, 4 years ago. Prudential told me I cannot put any money into pension

Transferring a standard DC ( defined contribution ) pension is simple as basically it is just a pot of money. However if that pension has any guarantees attached to it then it can be more problematic depending on what they are .The fact that it stopped at 60 is making me wonder why that is ?

Another option is to leave the Pru pension where it is , or transfer it later, and open a new one for new contributions only . In any case you would need to open up a new pension first before starting any transfer process.

 want to invest in a platform that I can buy into there ready made portfolios. The total funds to invest will be about £110000 including my prudential pension. Which platform do you think would be best.

These ready made portfolios are usually expensive and poor value for money . A simple low cost multi asset fund would probably suffice . As far as SIPP/pension platforms you could look at :

HL; Fidelity; AJ Bell; Interactive Investor; Iweb ( approx in order of cost ;iweb being the cheapest)

They each offer thousands of investments; shares etc but also some cheap multi asset funds

Vanguard - only offer Vanguard funds but low cost

Nutmeg; Wealthify ; Legal and General ; Simple & easy to operate but slightly more expensive.

xylophone

My wife has no private pension. If she started a pension with her earnings for this year which is about £15000. With probably no further contributions. Is that worth doing as I'm only thinking about the government 20% tax relief. Thanks 

Does her employer not offer a pension scheme?

Or is she self employed?

Assuming that she has made no pension contributions this year and will have relevant earnings of £15,000, she can pay up to a net £12000 into a personal pension and  the provider will claim tax relief of up to £3,000 and add it to her pot.

The Vanguard offering might suit her. https://www.vanguardinvestor.co.uk/what-we-offer/personal-pension/personal-pension-account

She could choose a ready made portfolio or build her own.

xylophone

I've  a pension with Prudential. The pension stopped when I was 60, 4 years ago. Prudential told me I cannot put any money into pension. 

What kind of pension is this? Does it have any "safeguarded benefits"? https://adviser.royallondon.com/technical-central/pensions/transfers/safeguarded-benefits/

What are safeguarded benefits?

Safeguarded benefits are defined as benefits that are not money purchase or cash balance benefits. This means defined benefits, guaranteed pensions including guaranteed minimum pensions and guaranteed annuity rates (GARs).

Rollingonandon

Thanks all for advice. My wife was part time self employed. We have some rental properties which give us about £12000 each. Though she hasn't worked for most of this year. What date would i need to set pensions up to get this year's tax relief.

Rollingonandon

The prudential  pension was with profits but that stopped when I reached 60. They said that with the cash fund I could buy an annuity. That wouldn't suit me though.

xylophone

Thanks all for advice. My wife was part time self employed. We have some rental properties which give us about £12000 each. Though she hasn't worked for most of this year. What date would i need to set pensions up to get this year's tax relief.

Rental income (except within a certain narrow category) see https://www.pruadviser.co.uk/knowledge-literature/knowledge-library/tax-relief-members-contributions/ does not count as relevant income for the purposes of pension tax relief.

HMRC define relevant earnings as:

• employment income such as pay, wages, bonus, overtime, commission (providing it is chargeable to tax under Section 7(2) ITEPA 2003)
• income chargeable under Part 2 ITTOIA 2005, that is income derived from the carrying on or exercise of a trade, profession or vocation (whether individually or as a partner acting personally in a partnership)
• patent income, where the individual alone or jointly devised the invention for which the patent in question is granted, in certain specific categories
• general earnings from an overseas Crown employment which are subject to tax in accordance with section 28 of ITEPA 2003
• rental income is generally not relevant earnings but some rental income may be included if it is in respect of UK or EEA furnished holiday lettings business