Company Pensions

[Minnsy]

My other half runs an online business with her co-director, and her accountant has suggested that it would be a good idea to set up a company pension scheme for the two of them to avoid a bit of corp tax, and also a bit of personal tax as well.
Can anyone suggest a company to talk to, to help with this? Or indeed an actual pension company who she could talk to directly to set this up?

Thanks in advance...

 

[pentel]

You might want to look at setting up individual self invested pensions with someone like interactive investor. II accept company contributions.

 

[MikeJ]

Given what I know now, I'd do what Pentel suggests. Open a SIPP, put it in a mixture of tracker funds and forget about it.

If you're in the central belt of Scotland, drop me a message and I'll give you the details of the people that handle mine. It is worth talking to a few IFAs though to sound them out, get an idea of fees, etc. A good one could really help. Our pension fund bought the building we were in, and rented it to us. Despite selling the company 6 years ago, they still rent the building and give an annual return of about 10%.

 

[pentel]

Our pension fund bought the building we were in, and rented it to us. Despite selling the company 6 years ago, they still rent the building and give an annual return of about 10%.

The proposed changes to IHT may make this less attractive in the future. This proposed change ( which is looking more like a certain change) has turned my IHT planning on its head!

 

[WaveJumper]

SIPP fund Interactive Investor are pretty good - look out for added inheritance tax changes regarding pensions coming along in 2027 thanks to Rachel Thieves.

 

[WaveJumper]

Sorry got distracted markets just opened. Personally I would invest my money in self investing Stocks ISA's at the moment you got 20k limit each a year. Dear old Rachel is looking to tinker with this you could see the limit raise as she wants to see more money pouring into company shares, one to watch out for.

Of course the profits you make in you 'self investing' Stocks ISA are all tax free unlike trying to get your money out of a SIPP

Please do your own research DYOR as we say in the trade.

 

[Lisa Thomas]

I can recommend a couple of IFA's if you don't find one on here.

 

[GLAbusiness]

I used an IFA recommended by my accountant.

 

[MikeJ]

Sorry got distracted markets just opened. Personally I would invest my money in self investing Stocks ISA's at the moment you got 20k limit each a year. Dear old Rachel is looking to tinker with this you could see the limit raise as she wants to see more money pouring into company shares, one to watch out for.

Of course the profits you make in you 'self investing' Stocks ISA are all tax free unlike trying to get your money out of a SIPP

Please do your own research DYOR as we say in the trade.

But you have to pay tax on the money before you can invest it.

 

[pentel]

I used an IFA recommended by my accountant.

An IFA's main purpose is to provide as much income to the IFA whist retaining their client, it is not to maximise returns for the client.

 

[UK Contractor Accountant]

The proposed changes to IHT may make this less attractive in the future. This proposed change ( which is looking more like a certain change) has turned my IHT planning on its head!

Leaving Pension to Spouse/Civil Partner still escapes the proposed changes.

Or partial nominations to children up to the nil rate band (£325K) and balance to spouse/civil partner.

Then Trust planning for other assets is the key.

 

[MikeJ]

The purpose of a pension is to provide for yourself in old age, not to avoid IHT.

 

[Lisa Thomas]

An IFA's main purpose is to provide as much income to the IFA whist retaining their client, it is not to maximise returns for the client.

Huh?

 

[MikeJ]

I'm sure there are some like that. My experience is quite different.

 

[Ozzy]

An IFA's main purpose is to provide as much income to the IFA whist retaining their client, it is not to maximise returns for the client.

I disagree, and if you find an IFA like that then report them to the FCA as they have very strict consumer laws they must comply with. In my experience IFA's I've experienced with have had my best interests to ensure I make the best returns while also be transparent with any income they have earned, which these days is a dedicated separate advisory payment from me rather than a revenue share from fund managers or similar.

 

[pentel]

In my experience IFA's I've experienced with have had my best interests to ensure I make the best returns

I am glad you have positive experiences with IFA's. Without going into details over the last 45 years I have had 4 different IFA's and in each case they have made more than I have by investing through them,

I think the worst return must be the £1000 I put in a pension in the early 80's from which I receive a flat pension of £1.79... per year... before tax!

 

[GLAbusiness]

I'm very happy with the service I get from my IFA

 

[pentel]

The purpose of a pension is to provide for yourself in old age, not to avoid IHT.

My older pensions specifically state that there is life insurance benefit of the full value of the pension fund and that this is held in trust for the beneficiaries on the expression of wishes form.

 

[MikeJ]

That's not the same thing though, is it? It's not passing on the unspent contents of the pension free of inheritance tax.

 

[pentel]

That's not the same thing though, is it? It's not passing on the unspent contents of the pension free of inheritance tax.

life insurance benefit of the full value of the pension fund

And as it is in trust it is supposed to be free of IHT

 

[UK Contractor Accountant]

And as it is in trust it is supposed to be free of IHT

was until Rachel Reeves decided to get her grubby hands on it.

 

[WaveJumper]

I can only add two the above those who have "plans" in place probably should re-visit them now, if you have a trust or even trusts in place double check the details there are so many anomalies you don't want to get tripped up.

Attached link re simple article on the changes coming up in 2027 all I would add is don't bury your head in the sand. I have no association with the link just thought it was any easy read

Inheritance Tax on pensions to affect savings | Flagstone

New Inheritance Tax rules on pensions could reduce what your loved ones inherit. Learn how to prepare and protect your savings.

www.flagstoneim.com

 

[WaveJumper]

was until Rachel Reeves decided to get her grubby hands on it.

And what the hell is she going to hit us all with in the Autumn budget ....... pretty sure it won't be good.

I keep hearing on various media outlets people talking about those leaving the country due to tax etc etc and those in the government denying this is the case. Can only speak for myself but I suddenly realised I now know of four people not multi millionaires by any means who have either upped sticks already or leaving by the end of this summer.

 

[UK Contractor Accountant]

And what the hell is she going to hit us all with in the Autumn budget ....... pretty sure it won't be good.

She has already attacked Farmers, Pensioners. Disability Benefit Claimants, Private Schools, Bereaved Military families etc ............ so whose next? and there is no guarantee that they wont kick up enough "stink" and cause another U turn.

Jonathan Ashworth former Shadow Health Minister discussed on TV this morning about removing the triple lock for Pensions may be looked at again. Fiscal drag is always a good one to hide behind.

 

[DontAsk]

Attached link re simple article on the changes coming up in 2027 all I would add is don't bury your head in the sand.

Don't make any rash decisions based on what might happen in the future.

 

[WaveJumper]

She has already attacked Farmers, Pensioners. Disability Benefit Claimants, Private Schools, Bereaved Military families etc ............ so whose next? and there is no guarantee that they wont kick up enough "stink" and cause another U turn.

Jonathan Ashworth former Shadow Health Minister discussed on TV this morning about removing the triple lock for Pensions may be looked at again. Fiscal drag is always a good one to hide behind.

I had to smile (slightly) this morning when I heard the nurses are now considering strike action as not happy with their pay, and the government response

"This government is clear we can't move any further on headline pay, but will work with the RCN to improve their major concerns, including pay structure reform, career progression and wider working conditions."

Well lets just see if they cave in again to the doctors and when they do I think the nurses will go ballistic.

It all falling apart at the seams at an alarming rate