Help with Pension laws

[blazing]

Hi.

I think I may have stupidly interpreted the rules and made a personal pension contribution that may incur a fine. Here's my case. I take the bare minimum salary 8788 and the rest as dividends. This year I took 39k in dividends. I took an additional 19k and made a personal contribution without realising that earnings count as "salary" i.e. my personal contribution limit for the tax year is 8788. I looked into carry forward rules and that is murky as ever. Can I salvage the situation? Or am I destined for a high tax bill?

[Lance]

I can't answer you exact question as I would never do this. I'd pay from LTD company profits, before CT into my personal pension. What you've done makes very little sense.

As for the actual question. What does your accountant say? Or don't you have one and that's why you did this in the first place?

[blazing]

I can't answer you exact question as I would never do this. I'd pay from LTD company profits, before CT into my personal pension. What you've done makes very little sense.

As for the actual question. What does your accountant say? Or don't you have one and that's why you did this in the first place?

Blame my lack of focus, too much work, recovery from covid and frankly I don't do pension. Been ages since I looked into it. For some reason, I thought dividends count as earnings. I did check but for some reason they never pointed out the problem.

[northernladuk]

Blame my lack of focus, too much work, recovery from covid and frankly I don't do pension. Been ages since I looked into it. For some reason, I thought dividends count as earnings. I did check but for some reason they never pointed out the problem.

Looks like you don't do accounting as well as pensions.

I blame the fact you didn't bother getting yourself an accountant. So much for saving money.

[Orangecat]

Not an advice, but perhaps you can try to ask your pension provider to return the extra amount and tell them it was a mistake.

[northernladuk]

Not an advice, but perhaps you can try to ask your pension provider to return the extra amount and tell them it was a mistake.

Please. Just stop posting and sort you own tulip out first before giving advice.

[Lance]

this is a guess only, but if you've over paid personally, you are not entitled the gov provided boost to the fund. So ringing the provider might be a good answer. I think the worst case scenario is the fund provider give back the extra 20% to the government.
But you must act now.

[Orangecat]

I only post because I saw how not nice your comments are to the host. Everyone has something they know and something they don't know. If you don't know, you don't post, if you anything that could be possible helpful. you say it. like "stop post , stop helping others "is not helpful. like "stop giving advice" is simply didn't read my post and show no respect to others as I mentioned "this is not an advice"

From my experience, it happens to that I ringed many pension provider in the past weeks and because I was worried about making mistakes so I checked with them if I make a mistake on the amount, is there a way to revert. They mentioned it is case by case, if it is a genuine mistake, they think it is possible to revert. Hope this can help the host of this post.

Please. Just stop posting and sort you own tulip out first before giving advice.

[luxCon]

Please. Just stop posting and sort you own tulip out first before giving advice.

Not sure what the issue is here. Pension providers will unwind any personal contribution and refund the HMRC for the 25% and return the original to the individual if asked by the plan holder.

Its a standard process, happens all the time.

As for the original poster, You are much better off making contribution through your Ltd company . That way you save on Corp tax and the higher dividend tax. But will NOT receive the topup.

If all in in this tax year see if your accountant can unwind the transactions. Return some of the dividends back and pay in to your pension via Ltd

[northernladuk]

Not sure what the issue is here. Pension providers will unwind any personal contribution and refund the HMRC for the 25% and return the original to the individual if asked by the plan holder.

Its a standard process, happens all the time.

If that's true then I'll go back and delete my responses.