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oldgitst
11th March 2016, 11:57
Hey all, great forum,

I am after some advice regarding pensions so please forgive me if it seems quite basic :-s

I have not held any pension whatsoever in the past.
I was goin to open a sipp can have the company that I own pay in a contribution of 40k for this current taxt year to offset some corp tax...

I was told I could also pay in a further 2 previous years allowances and offset the additional 80k against the current years profits.

I have also been advised I cannot do this as I did not hold a pension in the previous two year that I could make contributions into (I have the old opted out of serps one but no contributions where allowed to that) ....

Does that all sound correct ?

thanks so much for any advice, much appreciated
og

Contreras
11th March 2016, 21:14
Hey all, great forum,

I am after some advice regarding pensions so please forgive me if it seems quite basic :-s

I have not held any pension whatsoever in the past.
I was goin to open a sipp can have the company that I own pay in a contribution of 40k for this current taxt year to offset some corp tax...
Assuming the company has the profit to do it.


I was told I could also pay in a further 2 previous years allowances and offset the additional 80k against the current years profits.
Nope. Because...

I have also been advised I cannot do this as I did not hold a pension in the previous two year that I could make contributions into (I have the old opted out of serps one but no contributions where allowed to that) ....Exactly.


Does that all sound correct ?
Well as a sanity check, yes. But for a sum like that you really ought have had professional advice in light of the company's and your precise circumstances. The last thing you want is HMRC disallowing it after the fact.

MarillionFan
12th March 2016, 04:42
Assuming the company has the profit to do it.


Nope. Because...
Exactly.

Well as a sanity check, yes. But for a sum like that you really ought have had professional advice in light of the company's and your precise circumstances. The last thing you want is HMRC disallowing it after the fact.

But he heard right and you confirmed it. And now I'm agreeing with you.

No pension. No previous input.

oldgitst
13th March 2016, 15:15
Thanks for the advice, and in answer / clarification ...

Yes the profits are approx 300k nett, I have no pension so understand I can only use this tax years allowance, thank you for confirming that.
My wife has an old company pension from an old job many moons ago, we have contacted the pension company and they have confirmed she can and always has had the ability to make contributions into the pension.
So this would enable a company contribution into a sipp of 40k for myself for this tax year, and 50k 40k for previous on my wife's sipp plus this years allowance of a further 40k ....
Therefore 170k offset for the company in this tax year.
I do appreciate this is a forum and perhaps professional advice is appropriate and is something I will look further into, but can I ask if there are other criteria I also need to be aware of ?
Thank you again for any advice,
It is appreciated.
Og

MarillionFan
13th March 2016, 18:06
Thanks for the advice, and in answer / clarification ...

Yes the profits are approx 300k nett, I have no pension so understand I can only use this tax years allowance, thank you for confirming that.
My wife has an old company pension from an old job many moons ago, we have contacted the pension company and they have confirmed she can and always has had the ability to make contributions into the pension.
So this would enable a company contribution into a sipp of 40k for myself for this tax year, and 50k 40k for previous on my wife's sipp plus this years allowance of a further 40k ....
Therefore 170k offset for the company in this tax year.
I do appreciate this is a forum and perhaps professional advice is appropriate and is something I will look further into, but can I ask if there are other criteria I also need to be aware of ?
Thank you again for any advice,
It is appreciated.
Og

Yes. Depending on how you bleed your radiators further tax allowances may be possible.

northernladuk
13th March 2016, 18:16
Thanks for the advice, and in answer / clarification ...

Yes the profits are approx 300k nett, I have no pension so understand I can only use this tax years allowance, thank you for confirming that.
My wife has an old company pension from an old job many moons ago, we have contacted the pension company and they have confirmed she can and always has had the ability to make contributions into the pension.
So this would enable a company contribution into a sipp of 40k for myself for this tax year, and 50k 40k for previous on my wife's sipp plus this years allowance of a further 40k ....
Therefore 170k offset for the company in this tax year.
I do appreciate this is a forum and perhaps professional advice is appropriate and is something I will look further into, but can I ask if there are other criteria I also need to be aware of ?
Thank you again for any advice,
It is appreciated.
Og

Why are you asking about out how to manage 100s of K of your money on an internet forum? Why not go find a professional that actually cares?

At the very least you could have looked in General before posting...

SueEllen
13th March 2016, 19:21
oldgitst, do you like films on gladiators?

Do you bleed radiators?

oldgitst
13th March 2016, 20:19
Why are you asking about out how to manage 100s of K of your money on an internet forum? Why not go find a professional that actually cares?

At the very least you could have looked in General before posting...

Ok, I appreciate that and I'm trying to research all this now, I am trying to get what facts I can together and yes it's pointing towards taking professional advice BUT not being an accountant / or financial professional I didn't know it was as complicated as this in reference to pensions etc etc , I have tried to research parts but the Internet has so many contradictions I thought I would try a forum for some advice, good or bad. I wouldn't just base a decision on a forums advice but it doesn't hurt to listen to people and there views.
As for sueellens question about gladiator films and bleeding radiators.... I'm sorry I have no clue what you mean....
Thanks anyway for taking the time to post,
Cheers
Og

SueEllen
13th March 2016, 22:14
@oldgitst General is for banter - you are warned before entering this part of the forum. The stuff we post here covers Daily Mail stories, Nick Fritz Monday links and ripping the p*ss out of Suity.

The other parts of the forum are specifically for serious questions like the one you posted.

If you posted this here in the week you would have got more than just me enquiring about your preference for Gladiators and whether you bleed radiators....

oldgitst
13th March 2016, 22:42
Why are you asking about out how to manage 100s of K of your money on an internet forum? Why not go find a professional that actually cares?

At the very least you could have looked in General before posting...

Ok, I appreciate that and I'm trying to research all this now, I am trying to get what facts I can together and yes it's pointing towards taking professional advice BUT not being an accountant / or financial professional I didn't know it was as complicated as this in reference to pensions etc etc , I have tried to research parts but the Internet has so many contradictions I thought I would try a forum for some advice, good or bad. I wouldn't just base a decision on a forums advice but it doesn't hurt to listen to people and there views.
As for sueellens question about gladiator films and bleeding radiators.... I'm sorry I have no clue what you mean....
Thanks anyway for taking the time to post,
Cheers
Og

oldgitst
13th March 2016, 22:45
@oldgitst General is for banter - you are warned before entering this part of the forum. The stuff we post here covers Daily Mail stories, Nick Fritz Monday links and ripping the p*ss out of Suity.

The other parts of the forum are specifically for serious questions like the one you posted.

If you posted this here in the week you would have got more than just me enquiring about your preference for Gladiators and whether you bleed radiators....

Fair do's , I didn't realise ..... Apologies 😀

mackenzie99d
13th March 2016, 23:58
OP - when you say you may want to pay a large amount into your wifes pension I assume
your wife is an employee / director of the company? HRMC will need to be satisfied that
the salary / bonuses / pension contribution she receives is commercially reasonable for the work done.
When you have director e.g. yourself, who is the driving force behind the company and generates the
majority of the company income, then that renumeration package including the amount paid as pension is pretty much up to you. Now if your wife has a smaller role than you in generating the companies income but gets paid a much larger renumeration than you then HMRC may question this and most probably not allow it.

Contreras
14th March 2016, 01:47
So this would enable a company contribution into a sipp of 40k for myself for this tax year, and 50k 40k for previous on my wife's sipp plus this years allowance of a further 40k ....

Unlikely, unless you can show that salary+pension represents fair remuneration for each of you.

If you were sole director and fee earner then it is easy - whatever the amount (subject to pension limit), it must be fair remuneration seeing as you generated the profit. With two employees HMRC have a point of reference to compare so your plan will not wash unless the wife is also fee earning proportionally to your rate.

Btw, while it's good to DYOR, with the sort of sums you mention there is plenty of scope to screw things up royally. Best have an accountant check things over in light of your circumstances rather than regret it later.

oldgitst
14th March 2016, 10:50
OP - when you say you may want to pay a large amount into your wifes pension I assume
your wife is an employee / director of the company? HRMC will need to be satisfied that
the salary / bonuses / pension contribution she receives is commercially reasonable for the work done.
When you have director e.g. yourself, who is the driving force behind the company and generates the
majority of the company income, then that renumeration package including the amount paid as pension is pretty much up to you. Now if your wife has a smaller role than you in generating the companies income but gets paid a much larger renumeration than you then HMRC may question this and most probably not allow it.

Thanks for that.
Yes, she is an employee 45% shareholder....
BUT obviously isn't as involved as myself and gets paid basic wage same with dividend top up....
So maybe bad idea this lol.
IF she did have contributions for the rollback allowance, that obviously dwarfs mine as I cannot use the rollback.... would it be considered her remuneration of rollback being so high I should be awarding myself the same amount inside of the single current tax year ?
cheers
og

mackenzie99d
14th March 2016, 11:35
You need to get proper advice and you're running a bit short of time. In my opinion giving your wife a bigger pension contribution than yourself will cause problems as HMRC will consider it unreasonable. Have a search on the internet. I had a quick look and found this..

Adviser confirmation | Scottish Widows Extranet (http://www.scottishwidows.co.uk/extranet/literature/doc/FP0458)

oldgitst
14th March 2016, 13:29
You need to get proper advice and you're running a bit short of time. In my opinion giving your wife a bigger pension contribution than yourself will cause problems as HMRC will consider it unreasonable. Have a search on the internet. I had a quick look and found this..

Adviser confirmation | Scottish Widows Extranet (http://www.scottishwidows.co.uk/extranet/literature/doc/FP0458)

cheers, just had a read and has helped a lot, I think I could open a SIPP pay in the full allowance for 2015-2016 and do the same for my wife but at a slightly reduced amount.

Reading between the lines, the other halves rollover allowance probably isn't going to be feasible to use without it being a bit iffy....

cheers
og

IR35 Avoider
14th March 2016, 13:45
If the wife is doing admin for a one man company the I reckon almost any contribution however small will be considered excessive remuneration and not allowed as a deduction for Corporation tax.

On the other hand, if she is charging billable hours to clients, then anything up to the amount she has actually brought in should be OK (assuming it also within allowances.)

(Sorry, hadn't read the link, which looks like it is saying the same thing.)