Private Pension or Workplace via Salary Sacrifice?

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  • atush
    atush Posts: 18,726 Forumite
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    Also, if you are not married and she isnt working- she cant give you part of her unused personal allowance.

    Id do the registry and just not tell anyone (other than the tax man lol). have the 'wedding/renewl' in the caribbean later- you can pay for it with the tax you save ;)
  • woolly_wombat
    woolly_wombat Posts: 819 Forumite
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    Don't forget to ensure that she's registered for Child Benefit (even if she doesn't claim it) to ensure she gets NI credits to build State Pension entitlement.
  • Jaguar_Skills
    Jaguar_Skills Posts: 547 Forumite
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    woolly_wombat wrote: »
    Don't forget to ensure that she's registered for Child Benefit (even if she doesn't claim it) to ensure she gets NI credits to build State Pension entitlement.

    We have done that thanks.
  • Jaguar_Skills
    Jaguar_Skills Posts: 547 Forumite
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    Hi all,

    Thanks for all taking the time to help me plan for the future. I have reread all the comments again this morning and plan to do the following. If anyone has anything further to add which might help me I would be grateful to hear them. I am only 32 and trying to plan and be good financially but tax/pensions is all very confusing!

    So the plan:

    1) During bonus periods rather than make lump sum deposits into my private pension, make a contribution of £15,000 (total £30,000 over the year) to my work place pension to take advantage of salary sacrifice. With my £600 PCM into private pension this will keep me just under the £40k annual allowance = £37,200.

    Can always add in a little more before 31 March if I like?

    2) Equalise pensions a little by making monthly contributions of £250 PCM to my GFs pension. Would this be better to go directly into her private pension or through her LTD company which is still dormant (even though she is not working?)

    Does anyone have anything else to add or comments on my questions/points above?
  • lisyloo
    lisyloo Posts: 29,609 Forumite
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    edited 10 August 2018 at 10:58AM
    is a divorce in name only
    What is this?
    There are specific grounds for divorce.
    If you mean making it up to acheive a tax advantage then that's probably perjury and tax evasion.


    You cannot get a divorce on demand (see Tina Owens case who's forced to stay unhappily married).
  • michaels
    michaels Posts: 27,991 Forumite
    Photogenic Name Dropper First Anniversary First Post
    Jaguar_Skills wrote: »
    Hi all,

    Thanks for all taking the time to help me plan for the future. I have reread all the comments again this morning and plan to do the following. If anyone has anything further to add which might help me I would be grateful to hear them. I am only 32 and trying to plan and be good financially but tax/pensions is all very confusing!

    So the plan:

    1) During bonus periods rather than make lump sum deposits into my private pension, make a contribution of £15,000 (total £30,000 over the year) to my work place pension to take advantage of salary sacrifice. With my £600 PCM into private pension this will keep me just under the £40k annual allowance = £37,200.

    Can always add in a little more before 31 March if I like?

    2) Equalise pensions a little by making monthly contributions of £250 PCM to my GFs pension. Would this be better to go directly into her private pension or through her LTD company which is still dormant (even though she is not working?)

    Does anyone have anything else to add or comments on my questions/points above?

    For (1) This needs to work with NMW/NLW - not sure if this is assessed for each pay period (so monthly)?

    Don't know re 2, sorry. Would you be purchasing something from the company (your wife's labour?) in order to get the 2880 into it so it could afford to buy the pension?
    I think....
  • MallyGirl
    MallyGirl Posts: 6,610 Senior Ambassador
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    Jaguar_Skills wrote: »

    So the plan:

    1) During bonus periods rather than make lump sum deposits into my private pension, make a contribution of £15,000 (total £30,000 over the year) to my work place pension to take advantage of salary sacrifice. With my £600 PCM into private pension this will keep me just under the £40k annual allowance = £37,200.

    The £40k has to include any employer contribution such as %age matchin or them giving back their NI.
    I’m a Senior Forum Ambassador and I support the Forum Team on the Pensions, Annuities & Retirement Planning, Loans
    & Credit Cards boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com.
    All views are my own and not the official line of MoneySavingExpert.
  • Jaguar_Skills
    Jaguar_Skills Posts: 547 Forumite
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    michaels wrote: »
    For (1) This needs to work with NMW/NLW - not sure if this is assessed for each pay period (so monthly)?

    Don't know re 2, sorry. Would you be purchasing something from the company (your wife's labour?) in order to get the 2880 into it so it could afford to buy the pension?

    Hi, thanks - what do the abbreviations stand for in 1)

    re 2) I wouldn't be purchasing anything from her as I am PAYE so couldn't really justify this if HMRC asked. Was just thinking if her company paid it would it be any better but I think I can't do this?
  • lisyloo
    lisyloo Posts: 29,609 Forumite
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    1) refers to nation minmum wage.


    Your employer has to pay you minimum way by law, so if doing salary sacrifice you must receive this.
    As your a high earner might not be an issue in your case.


    If for example someone earned £40K per annum, they cannot salary sacrifce £40K as they have to received minimum wage, so their contribution limit would be more like £27.5K.
  • Jaguar_Skills
    Jaguar_Skills Posts: 547 Forumite
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    MallyGirl wrote: »
    The £40k has to include any employer contribution such as %age matchin or them giving back their NI.

    Thanks is there a way of easily working out if I was going to go over the £40k AA?

    I am still not 100% sure of what the downside to doing this is, is it just that you lose tax relief?
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