contributing to wife's pension plan ?

honestcrust

I have read somewhere that I can contribute up to about £3000 a year into a partners pension plan. Two questions ... Can I claim back the income tax that I have already paid at source at the end of the tax year ? I am taxed by P.A.Y.E. Secondly ... given that a pensioner of 65 can earn about £7000 tax free(?), am I better off contributing into a seperate pension for my wife, in order to fully utilise the tax free allowance for each of us, or accruing a larger pension pot for myself causing me to pay tax on income likely to be over £7000 a year ? My wife is a health care worker and has never been able to afford a pension, other than paying NI contributions. Can anyone offer any advice? What do I need to consider ?

dunstonh

I have read somewhere that I can contribute up to about £3000 a year into a partners pension plan.

You can pay upto 100% of her income or £3600 p.a. whichever is higher and get tax relief on the contributions.

I claim back the income tax that I have already paid at source at the end of the tax year ?

No. It is her pension so tax relief will be in her name. So, the cheque will be written for £2808 and the tax relief will take it to £3600.

Secondly ... given that a pensioner of 65 can earn about £7000 tax free(?),

10k within a couple of years.

am I better off contributing into a seperate pension for my wife, in order to fully utilise the tax free allowance for each of us, or accruing a larger pension pot for myself causing me to pay tax on income likely to be over £7000 a year ?

Logically, you use your wife.

My wife is a health care worker and has never been able to afford a pension, other than paying NI contributions.

I hope that doesnt mean she has not opted to join the NHS occupational pension scheme.

honestcrust

Thanks for your reply. A pity the pensions advisers I have spoken to in the past have not suggested this route... they only wanted to sell me a different pension.
... the NHS scheme is good, but my wife works in the private sector for an employer, like many others, that doesn't offer a contributary pension scheme.