Pension help please

Blonde Accountant
Blonde Accountant Feels At HomeRegistered Posts: 86
Hi, I'm sure loads of you know the answers to this as I probably should-but don't

Can directors of a company pay into a private pension (nothing to do with the company) out of the company bank account and put it as an expense on the p&l a/c?

If so, is there a maximum limit as to how much they can pay in per year-please?

Many thanks for the anticipated help

Nicola:001_smile:

Comments

  • Monsoon
    Monsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    Not my forte but as I understand it:

    No. The company can pay into a company pension scheme for the director(s) and claim it as an expense.

    Or, the directors can pay into a personal pension with money that's been extracted from the company by the normal route (salary/div).
  • deanshepherd
    deanshepherd Font Of All Knowledge Registered Posts: 1,809
    The company CAN pay into a personal pension scheme of the directors. The main benefit being that there is no limit on the size of contribution as linked to earnings (there is still the £50k annual and £1.8m lifetime limits).
  • Blonde Accountant
    Blonde Accountant Feels At Home Registered Posts: 86
    Hi,

    Many thanks both of you for taking the time to respond
  • reader
    reader Experienced Mentor MAAT, AAT Licensed Accountant Posts: 1,042
    I guess if the company contributed to the director's personal pension a P11D would have to be completed?

    Would it be more tax efficient to post the personal pension payments to the director's loan account and raise the necessary dividend vouchers against the personal pension payments?
  • deanshepherd
    deanshepherd Font Of All Knowledge Registered Posts: 1,809
    reader wrote: »
    I guess if the company contributed to the director's personal pension a P11D would have to be completed?

    No.
    Would it be more tax efficient to post the personal pension payments to the director's loan account and raise the necessary dividend vouchers against the personal pension payments?

    No.

    I'm assuming these are company contributions to a personal pension (paid in gross) and not simply paying the directors own contributions via the company account (paid in net).
  • Monsoon
    Monsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    Monsoon wrote: »
    Not my forte

    I got that bit right :lol:
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