Tax and pension question
Discussion
Im currently a higher rate tax payer under PAYE in permanent full time employment.
One option I am considering is to resign and look for a simar role at another firm but as a contractor through a ltd company. I would draw a similar amount (becuse of mortgage and other living expenses) to what I currently earn so i assume it wouldn't be hugely more tax efficient for me but i giess it would keep HMRC happy.
However, as I understand, i could pay all remaining profit i to a self invested pension (am i right in that there is no limit in what the company can contribute?) and in addition, transfer my existing employers pension fund into the SIP.
I can then use the SIP to buy commercial property which i can then rent out to the company at an arms length rent. As the SIP can only borrow up to 50% of the assets it has, for any shortfall, if I were to make a contributon for example by releasing equity from a current investment property, will i get tax relief at 40% as an adjustment to my next years PAYE coding or could I negotiate with HMRC a more immediate rebate following submission self assessment?
Would the above be considered efficient tax planning? And would I be reccommended to get clearance with HMRC before I proceed?
Perhaps a question for Sumo69 Eric MC or other experts?
One option I am considering is to resign and look for a simar role at another firm but as a contractor through a ltd company. I would draw a similar amount (becuse of mortgage and other living expenses) to what I currently earn so i assume it wouldn't be hugely more tax efficient for me but i giess it would keep HMRC happy.
However, as I understand, i could pay all remaining profit i to a self invested pension (am i right in that there is no limit in what the company can contribute?) and in addition, transfer my existing employers pension fund into the SIP.
I can then use the SIP to buy commercial property which i can then rent out to the company at an arms length rent. As the SIP can only borrow up to 50% of the assets it has, for any shortfall, if I were to make a contributon for example by releasing equity from a current investment property, will i get tax relief at 40% as an adjustment to my next years PAYE coding or could I negotiate with HMRC a more immediate rebate following submission self assessment?
Would the above be considered efficient tax planning? And would I be reccommended to get clearance with HMRC before I proceed?
Perhaps a question for Sumo69 Eric MC or other experts?
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