Hi
I’m hoping someone can help. My wife and I are both directors of a limited company and we both contract (albeit that my wife’s billing rate is much lower than mine). I was not in a contract for most of the calender year 2018 but have being working since last November 2018.
I’m now looking to backdate company pensions for both myself and my wife and the notional figure we can back date is £110K each based on the years/figures below (see fig a)
The company has sufficient retained funds to afford such an investment but my accountant is advising me against putting 220K into the pension on the basis that since that amount is higher than my turnover for the current company year, it would trigger a loss that could lead to a HRMC enquiry.
On that basis, he has recommended only putting in 110K between the 2 of us rather than 110K each.
I thought it was possible to make the payment from retained funds rather than just current profits.
I was planning to close the company by the end of this year anyway due to IR35 and wanted to push as much into our pensions as possible prior to this.
I have seen other posts where this seems to have been done so I’m not sure if my accountant is being unduly cautious.
Any guidance would be appreciated.
Thanks.
(fig a)
Tax Year Pension Amount Paid Additional Amount Contribute Husband Additional Amount Contribute Wife
2019-2020 0 40000 40000
2018-2019 10000 30000 30000
2017-2018 0 40000 40000
I’m hoping someone can help. My wife and I are both directors of a limited company and we both contract (albeit that my wife’s billing rate is much lower than mine). I was not in a contract for most of the calender year 2018 but have being working since last November 2018.
I’m now looking to backdate company pensions for both myself and my wife and the notional figure we can back date is £110K each based on the years/figures below (see fig a)
The company has sufficient retained funds to afford such an investment but my accountant is advising me against putting 220K into the pension on the basis that since that amount is higher than my turnover for the current company year, it would trigger a loss that could lead to a HRMC enquiry.
On that basis, he has recommended only putting in 110K between the 2 of us rather than 110K each.
I thought it was possible to make the payment from retained funds rather than just current profits.
I was planning to close the company by the end of this year anyway due to IR35 and wanted to push as much into our pensions as possible prior to this.
I have seen other posts where this seems to have been done so I’m not sure if my accountant is being unduly cautious.
Any guidance would be appreciated.
Thanks.
(fig a)
Tax Year Pension Amount Paid Additional Amount Contribute Husband Additional Amount Contribute Wife
2019-2020 0 40000 40000
2018-2019 10000 30000 30000
2017-2018 0 40000 40000
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