How do i go about getting a pension?

[Hyena]

trickywoo said:

As an old hand I sincerly hope you don't stay long newbie as you are a throughly unpleasant person who has clashed with a number of other people who are being helpful and thoughtful by throwing poor insults and being generally obnoxious.

I really don't understand why you are denying that the company of a sole director limited in the UK can put in £40k a year pension contributions for the director regardelss of the directors PAYE income and also use three years worth of unused allowance. Its a fact.

I don't like posting links to support arguments but the link in my earlier post from a firm of accountants says exactly this in words I thought you might understand, but sadly not.

Why don't you do everyone a favour and just go away?

Lol, unfortunately dickywoo old fruit, you completely failed to comprehend the links I posted previously, which explain the misconception you insist upon labouring .

But hey, if you consider it "helpful & thoughtful" to advise someone on finances by telling them they can buy an ISA and a SIPP, and put them inside a wrapper , then I can only pity the victims of such an old hand job like yourself.

[trickywoo]

Hyena said:

Lol, unfortunately dickywoo old fruit, you completely failed to comprehend the links I posted previously, which explain the misconception you insist upon labouring .

But hey, if you consider it "helpful & thoughtful" to advise someone on finances by telling them they can buy an ISA and a SIPP, and put them inside a wrapper , then I can only pity the victims of such an old hand job like yourself.

I said "You can put SIPP money into pretty much any wrapper that you can an ISA." but misquote all you like, hopefully we'll get into libel.

I don't really see how this is confusing particularly in the context of me then saying PHers like Vangaurd Life as much as MX5s. You / your company can put SIPP money into Vangard Life and you can also put ISA money into the same via a stocks and shares ISA. The same is true of multiple funds (wrappers) offered by the likes of Fidelity, Hargreaves etc.

I hope you are just young and foolish as your attitude stinks.

[Hyena]

trickywoo said:

I said "You can put SIPP money into pretty much any wrapper that you can an ISA." but misquote all you like, hopefully we'll get into libel.

I don't really see how this is confusing particularly in the context of me then saying PHers like Vangaurd Life as much as MX5s. You / your company can put SIPP money into Vangard Life and you can also put ISA money into the same via a stocks and shares ISA. The same is true of multiple funds (wrappers) offered by the likes of Fidelity, Hargreaves etc.

I hope you are just young and foolish as your attitude stinks.

All of which just illustrates my point that you have zero comprehension of what comprises a wrapper, and what comprises a product.

A fund is a PRODUCT, not a WRAPPER you complete bellend !

[trickywoo]

Hyena said:

All of which just illustrates my point that you have zero comprehension of what comprises a wrapper, and what comprises a product.

A fund is a PRODUCT, not a WRAPPER you complete bellend !

All of which illustrates my point that you are an odious fool who needs to go away.

[Hyena]

trickywoo said:

All of which illustrates my point that you are an odious fool who needs to go away.

No need to apologise.

Bellend

[Jockman]

Anyway.....hope OP gathered some useful info from this thread.

No substitute for proper professional advice but I try and relate to my real life experiences.

There are sufficiently generous allowances that can be put to good use, especially if married.

All the Best.

[Bristol spark]

Blimey, this escalated..........

Just for the record, i wont be putting anywhere near £40K a year into a pension.
Maybe £500/Month as i would still like some money left to spend on myself before im in my 60's!!

[Jockman]

Bristol spark said:

Blimey, this escalated..........

Just for the record, i wont be putting anywhere near £40K a year into a pension.
Maybe £500/Month as i would still like some money left to spend on myself before im in my 60's!!

Good lad. Get the Company to do it.

I do it for the wife on the Transact platform, though others are available.

[trickywoo]

Bristol spark said:

Blimey, this escalated..........

Hymen seems to be a bit of a tt (rubbed a few other people on the forum up the wrong way ). Hopefully be gone soon.

Hopefully by way of some form of useful conclusion, which is what the forums are about, a pension is well worthwhile, and either or both of you and your company can contribute with worthwhile tax savings albeit with compromises as regards the age at which you can access the funds.

All the best

[JulianPH]

Bristol spark said:

Im 27, self employed (via ltd company). I have 0 pension, I've previously not done anything just incase i drop dead before pension age!!

However now I am edging further towards middle aged i realise this is not the wisest policy, incase i survive.....


So how does one go about sorting a pension?

I assume i can do this via my company with pre-tax contributions?

Do i need to get my accountant to sort this? or are there companies that sort this out?

Anyone any advice? I have absolutely no clue how pensions work.

Cheers

Well, that got very messy didn't it? And of no use or value to the OP at all.

I'll try and tidy up...

A company can make a contribution up to £40,000 (if trading income is sufficient) regardless of the earning of the employee/director. This is because the contribution itself becomes de facto taxable earnings - meaning relevant earnings are met.

However, a company can only make a valid contribution in this way if it received by the pension/SIPP in the same accounting period. It is not possible to carry the contribution back or forward to other periods.

Okay? (not that this is of any help to the OP)

OP:

You can set up a pension/SIPP yourself with someone like Hargreaves Lansdown (or many others). It is a quick process. If you are not comfortable pick funds/shares yourself you could use someone like Parmenion who will manage a portfolio for you (this can also be cheaper than doing it yourself).

Yes, you can do this with pre-tax income (saving corporation tax and paying no income tax) providing the company has sufficient funds to meet the contributions out of normal trading activity in each accounting period.

You don't need to get your accountant to do this for you (and most wouldn't anyway as they are not authorised to do so) but obviously let them know what you are doing so they can account for it correctly.

I don't know if you own your business property or rent/lease it, but it is worth remembering that when you have built up sufficient funds in a SIPP your SIPP can buy the business property and your business would then pay rent to your SIPP (which is very handy!).

Cheers

[trickywoo]

JulianPH said:

However, a company can only make a valid contribution in this way if it received by the pension/SIPP in the same accounting period. It is not possible to carry the contribution back or forward to other periods.

Thanks for that but wonder if you can expand on this a bit?

If we assume a sole director company making no profit for two years and then a bumber profit in third year of £150k are you saying that if an established pension was in place for the director in year one, with the company having paid in £1k, that before the end of the third year accounting period it cannot make a pension contribution of £119,000? i.e. the unused £39k from year one, £40k from year two and £40k for year three? Assuming they pass the ‘wholly and exclusively’ test etc?

My friend has done this and its been signed off by the accountant and HMRC.

[JulianPH]

trickywoo said:

JulianPH said:

However, a company can only make a valid contribution in this way if it received by the pension/SIPP in the same accounting period. It is not possible to carry the contribution back or forward to other periods.

Thanks for that but wonder if you can expand on this a bit?

If we assume a sole director company making no profit for two years and then a bumber profit in third year of £150k are you saying that if an established pension was in place for the director in year one, with the company having paid in £1k, that before the end of the third year accounting period it cannot make a pension contribution of £119,000? i.e. the unused £39k from year one, £40k from year two and £40k for year three? Assuming they pass the ‘wholly and exclusively’ test etc?

My friend has done this and its been signed off by the accountant and HMRC.

That is indeed my understanding of it. This is HMRC's amended stance (they appear to have changed the rules):

https://www.gov.uk/hmrc-internal-manuals/pensions-...

Changes to the normal rules for deductible expenses

The pension tax legislation amends the normal rules for allowable deductions slightly. These changes are as follows.

Employers carrying on a trade or profession

Section 196(2) Finance Act 2004

When working out the amount of the profits, pension contributions can only be deducted for the period of account in which they were paid. It is not possible to carry the contribution back or forward to other periods.


I'm happy for my interpretation of this to be proved wrong, but the OP doesn't even have a pension so it is not relevant in this case anyway.

[JulianPH]

Actually, I have just had a look at the legislation itself and think I was wrong in my initial interpretation.

The link I posted only referenced deductible expenses for the company during an accounting year. Whilst this deductible expense cannot be carried forward or backward to any other accounting year, that does not mean that a company could not (with sufficient profit) make 3 x £40,000 payments (under pension legislation) providing the payment is made - and therefore the deduction of profits crystallised - in the same accounting period.

Unlike others I don't mind changing my stance, it shows I have learned something new!

[trickywoo]

Thanks for that. I'm all for reasoned discussion.

[Jockman]

JulianPH said:

I don't know if you own your business property or rent/lease it, but it is worth remembering that when you have built up sufficient funds in a SIPP your SIPP can buy the business property and your business would then pay rent to your SIPP (which is very handy!).

Indeed. If you have unused allowances from previous years you may not even need the full property value in your fund to do this !!

[JulianPH]

Jockman said:

Indeed. If you have unused allowances from previous years you may not even need the full property value in your fund to do this !!

When are you getting back into an Aston Martin again Phil, or is that itch scratched?!

Yes, the OP should consider using a SIPP to not only provide for a retirement income, but to reduce/avoid corporation tax and purchase a commercial property that pays money into his SIPP each month/quarter from his business.

The tax savings from that combination would be incredible. OP - pensions (specifically SIPPs) are for far more than retirement planning. Of course that is the ultimate aim, but you can save a fortune in tax along the way if you own your own business.

Any questions then just ask. Hopefully the off topic digs have gone away and we can actually be of some help to you!

[Jockman]

JulianPH said:

Jockman said:

Indeed. If you have unused allowances from previous years you may not even need the full property value in your fund to do this !!

When are you getting back into an Aston Martin again Phil, or is that itch scratched?!

Yes, the OP should consider using a SIPP to not only provide for a retirement income, but to reduce/avoid corporation tax and purchase a commercial property that pays money into his SIPP each month/quarter from his business.

The tax savings from that combination would be incredible. OP - pensions (specifically SIPPs) are for far more than retirement planning. Of course that is the ultimate aim, but you can save a fortune in tax along the way if you own your own business.

Any questions then just ask. Hopefully the off topic digs have gone away and we can actually be of some help to you!

Cheers Julian - you just described our SIPP set up !!!

Hope you're still enjoying your wonderful car. I would love to be back some day. Might need to sell the company first

[JulianPH]

Jockman said:

Cheers Julian - you just described our SIPP set up !!!

Hope you're still enjoying your wonderful car. I would love to be back some day. Might need to sell the company first

Hi Phil, Absolutely! I can't justify the spend to move into the DBS right now as it is not worth 3 times the price of my DB9 (IMHO).

Also I made a snap decision last Friday. You can see all about it here...

https://www.pistonheads.com/gassing/topic.asp?h=0&...

I sometimes have these rash moments!!!

[Jockman]

JulianPH said:

Jockman said:

Cheers Julian - you just described our SIPP set up !!!

Hope you're still enjoying your wonderful car. I would love to be back some day. Might need to sell the company first

Hi Phil, Absolutely! I can't justify the spend to move into the DBS right now as it is not worth 3 times the price of my DB9 (IMHO).

Also I made a snap decision last Friday. You can see all about it here...

https://www.pistonheads.com/gassing/topic.asp?h=0&...

I sometimes have these rash moments!!!

Brilliant !!!

Love the way the balustrade steps afford you the opportunity for a run and jump.....

I'm with you on the cars. They are not 3x better - I've had both as you know - though the DBS is a superior, belter of a car.

[JulianPH]

Jockman said:

Brilliant !!!

Love the way the balustrade steps afford you the opportunity for a run and jump.....

I'm with you on the cars. They are not 3x better - I've had both as you know - though the DBS is a superior, belter of a car.

Yes I remembered, hence asking for your thoughts. You were very helpful when I was looking to buy a DBS and I'm glad I ended up going for an early DB9 after the experience the first dealer put me through. Dealers should know that people buying cars like a DBS (or even a DB9) often are having a momentous moment in life and expect to be treated well.

Glad you like the impromptu pool build and the steps are certainly going to end up being used as you describe.

The size of the hole is obviously larger than the size of the pool (by 40cm each side) so there will need to be a couple of steps before the jump in!

Cheers

Edited by JulianPH on Saturday 15th July 17:07