IR35 as you're approaching retirement

[ChimpMaster]

Good point made by OP.

I've been permie now for a couple of years and have been putting 70% of my salary into a pension via salary sacrifice. I'm still some years off retirement but I don't need the salary to survive and the 30% left over is enough after tax for a bit of a jolly. I'm still in the higher rate bracket through due to rental income, only because its made worse by s24 tax, but at least my salary sacrifice helps reduce (or 'defer' ) the pain.

[Heathmount]

I ran the calcs myself for an inside rate, again with the giant calculator, turns out you can get a 93% take home pay effectively once you put it all into a SIPP, no 19% corp tax (more like 20%+ these days with the tapering), so it's not bad at all. I'm going to invest most of that money anyway so i can retire early so, a SIPP is as good a place as any.

Plus I've not put any into the pension for the last 3 years so I can put up to £180k this year.

I can do exactly the same (and more) with a ltd company, but an outside rate doesn't get the same uplift as an inside one.

What spun me into action was the ~50% tax I'd have to pay were I not putting all of it into a SIPP!!!!!!

Only if you have earnings this year of at least £180k. You can only put in max 100% of earnings regardless of how much you have ‘available’ due to carry forward rules.

[Protagoras]

Only if you have earnings this year of at least £180k. You can only put in max 100% of earnings regardless of how much you have ‘available’ due to carry forward rules.

The mechanism for making these pension contributions is as an employer contribution, so there's really no limit, although these contribute to the employee's annual allowance.

e.g. https://techzone.abrdn.com/public/pe...-contributions

[Guy Incognito]

You can only exceed 100% of salary without additional tax as a director, which if you are inside IR35 you are not.

[Protagoras]

You can only exceed 100% of salary without additional tax as a director, which if you are inside IR35 you are not.

Ah yes.

[Lance]

You can only exceed 100% of salary without additional tax as a director, which if you are inside IR35 you are not.

can you use retained profit in a LTD. to pay into a pension, in excess of your salary, if you are currently in an inside contract?

[Eirikur]

can you use retained profit in a LTD. to pay into a pension, in excess of your salary, if you are currently in an inside contract?

Yes, that's what I have done for this and last tax year

[Lance]

Yes, that's what I have done for this and last tax year

cool.
Might be a better option than MVL is what I'm thinking.

[Eirikur]

cool.
Might be a better option than MVL is what I'm thinking.

I reduced the cash in my company below the MVL limit (by paying into my pension) and am now going for closure and can withdraw the remaining amount as capital gains with the £6000 tax free limit (per shareholder) and 10% over the remaining bit as soon as my final accounts are being completed.

[jamesbrown]

There is no MVL limit, that’s the point of an MVL as distinct from a strike off.