Basic pensions question
Discussion
I'm about to setup a pension scheme for my Ltd Company, I'm the only employee.
I pay myself a small salary, and top it up with dividends - last year I only paid myself up to the higher rate limit, but this year I will go into higher rate tax.
My question is around tax relief - if I get the company to pay all of my contributions, the company gets corporation tax relief on that.
Is that it as far as tax relief is concerned? Or do I get further tax relief when I complete my self assessment?
In my mind if I get the company to pay the contributions, I get say 20% tax relief, but if I deduct them from my net pay, I can get 40% relief if I'm a higher rate taxpayer.
Cant be right as the internet says its usually better to get the company to pay them.
What am I missing here?
I pay myself a small salary, and top it up with dividends - last year I only paid myself up to the higher rate limit, but this year I will go into higher rate tax.
My question is around tax relief - if I get the company to pay all of my contributions, the company gets corporation tax relief on that.
Is that it as far as tax relief is concerned? Or do I get further tax relief when I complete my self assessment?
In my mind if I get the company to pay the contributions, I get say 20% tax relief, but if I deduct them from my net pay, I can get 40% relief if I'm a higher rate taxpayer.
Cant be right as the internet says its usually better to get the company to pay them.
What am I missing here?
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