Invest my ltd company funds?
Discussion
Jockman said:
It’s the £40k annual pension allowance. Per person. Includes all contributions from any source.
You trying to max all the family?
So after 40k per person there is no Corp tax relief?You trying to max all the family?
Been a while since I have had that much but I was sure we got Corp relief.
I can barely add up so it's not my strong point.
desolate said:
Jockman said:
It’s the £40k annual pension allowance. Per person. Includes all contributions from any source.
You trying to max all the family?
So after 40k per person there is no Corp tax relief?You trying to max all the family?
Been a while since I have had that much but I was sure we got Corp relief.
I can barely add up so it's not my strong point.
desolate said:
Jockman said:
You using carry forward ?
It's hypothetical.I was under the impression the company can contribute as much as it wants to pensions and get Corp relief.
My understanding is that you will be limited to £40k allowance per person. Even then it can be more complicated than this due to carry forward as well as tapered annual allowances.
Do you have a link to confirm your thoughts?
Jockman said:
I would be so happy if this were true.
My understanding is that you will be limited to £40k allowance per person. Even then it can be more complicated than this due to carry forward as well as tapered annual allowances.
Do you have a link to confirm your thoughts?
I am working from memory. My understanding is that you will be limited to £40k allowance per person. Even then it can be more complicated than this due to carry forward as well as tapered annual allowances.
Do you have a link to confirm your thoughts?
We had 8 in our SSAS so I have probably got it wrong.
Edit
https://www.pruadviser.co.uk/knowledge-literature/...
Only on my phone so skim read.
I can ask tomorrow if you really want to know.
Edited by anonymous-user on Thursday 15th March 21:10
desolate said:
Jockman said:
I would be so happy if this were true.
My understanding is that you will be limited to £40k allowance per person. Even then it can be more complicated than this due to carry forward as well as tapered annual allowances.
Do you have a link to confirm your thoughts?
I am working from memory. My understanding is that you will be limited to £40k allowance per person. Even then it can be more complicated than this due to carry forward as well as tapered annual allowances.
Do you have a link to confirm your thoughts?
We had 8 in our SSAS so I have probably got it wrong.
Edit
https://www.pruadviser.co.uk/knowledge-literature/...
Only on my phone so skim read.
I can ask tomorrow if you really want to know.
Edited by desolate on Thursday 15th March 21:10
Interesting article which seems to lead me in your direction until the end where it says that the employer contribution will be assessed against the members annual allowance.
In previous years when you were running this that may have posed no issue as with 8 members and a peak allowance of £255k EACH it may have seemed like unlimited amounts were permitted for Corp tax relief.
As an enthusiastic amateur too you’ve certainly given me enough info to think about it so I’ve forwarded the article to my IFA for feedback. Hopefully get an opinion once he’s available.
Only read this page so I hope I have the gist.
The employer can pay any amount to an employees pension arrangement.
Any contribution will need to be considered a legitimate expense of the business, which for a Director shouldn't be an issue, and it will then receive corporation tax relief.
If the contribution exceeds the allowance available to the employee then the pension arrangements Scheme Administrator must report the excess to HMRC. A tax charge on the excess will then be levied on the employee.
The employer can pay any amount to an employees pension arrangement.
Any contribution will need to be considered a legitimate expense of the business, which for a Director shouldn't be an issue, and it will then receive corporation tax relief.
If the contribution exceeds the allowance available to the employee then the pension arrangements Scheme Administrator must report the excess to HMRC. A tax charge on the excess will then be levied on the employee.
PurpleMoonlight said:
There is no legislated maximum, only a maximum that is tax free.
Ok thanks. So it appears I am wrong and that everything over 40k does get a tax charge on it.It's a while since we did this and the FD of the old firm is dead and the accountant retired so I can't ask.
We must have been using the allowances of all the members.
Still I suppose you could set up a SSAS and get 80k a year into a single investment vehicle for you and your partner.
CzechItOut said:
Is there any limitation on the employers contribution in relation to the director's salary?
Only in relation to a legitimate expense of the business.HMRC love excess contributions.
They get income tax going it (greater than corporation tax) and then income tax again on 75% of it on the way out.
Jonny TVR said:
I'm maxed out at £40K a year pension contribution and I don't have a wife. Can I theoretically pay £40K a year to each of my children who are 10, 13, 15. Not sure I would want to but possibly pay something into each a year?
I think you can personally pay £2,880 pa into each and basic rate tax would be added to it.PurpleMoonlight said:
CzechItOut said:
Is there any limitation on the employers contribution in relation to the director's salary?
Only in relation to a legitimate expense of the business.HMRC love excess contributions.
They get income tax going it (greater than corporation tax) and then income tax again on 75% of it on the way out.
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