Pension Allowance and Tax Relief from Third Party (Vanguard SIPP)

tryingtogetmyheadaround

Just trying to work out how I can get the most tax relief by putting money into my Vanguard SIPP. Current situation I am a company director and have been left some money which I want to get into a pension. As a company director I take a minimum wage (£12500), my wife works part time and earns £6000 a year. 

I have already maxed out my pension allowance to hit the same as my wage. I notice on vanguard SIPP I can pay in more via my business (limited company) which i fully understand. What I don't get is payment from a third party the website says this........

Third party

You can set up your account to receive single payments from anyone with a Vanguard account. Payments in excess of £2,880 may not be eligible for tax relief.

So my question is can my wife (who has already paid into her own pension to the max) pay £2880 into my pension and then tax relief added like we normally get paying in ourselves.

Thinking I set up a Vanguard Standard account in my wife's name and then move the money into my pension.

Has anyone else done this, or am I looking for a loop hole that doesn't exist to get more money into a SIPP.

Albermarle

You can receive third party payments into your SIPP , but they are only eligible for tax relief if you have the taxable earnings to support that.

biscan25

Could you not just pay yourself more?

Thrugelmir

Have a chat with your accountant to determine the best way of distributing the profit your company makes. 

dunstonh

I have already maxed out my pension allowance to hit the same as my wage. I notice on vanguard SIPP I can pay in more via my business (limited company) which i fully understand. What I don't get is payment from a third party the website says this........

You shouldn't be paying pension contributions personally.  That is highly inefficient and potentially a missale if done via an adviser.   You should be making employer contributions.    The maximum you can contribute is £160k, minus your contributions made over the last 3 years and current year.    However, the level of corporation tax you pay will influence the ideal contribution you can make.

So my question is can my wife (who has already paid into her own pension to the max) pay £2880 into my pension and then tax relief added like we normally get paying in ourselves.

There is no logical reason for you to make third party payments.  And spouses do not count as third party unless it is from their sole banking account.  Even then, many providers will not treat that as a third party payment.  

Has anyone else done this, or am I looking for a loop hole that doesn't exist to get more money into a SIPP.

There are no loopholes.  However, you do appear to be confused about pensions and using a payment method that is not very tax efficient.   Speak to your adviser or accountant and get them to fix it (note, some accountants have little knowledge about pensions nowadays.  So, they may not be able to help)