Too much money in the bank...

[ASB]

I'm in a similar situation. I know I need to take out more so will end up being in the higher rate tax bracket.

Can someone clarify whether then I should make pension contributions from the company or personally?

Yes, I have looked at other posts but still was unsure. Can I do both?

Cheers

TMD

1) If the money was coming out as salary then it is unlikely that there are any circumstances in which it is better to pay personal contributions.

2) If the money however extracted - is not eligible as pensionable then you won't get any relief on it. (Not likely but possible, gllash posted on this the other day).

3) If the money is extracted as dividends then it is possible marginally better to make personal contribution if you are a standard rate taxpayer. As a higher rate payer the advantage is slightly greater (of course compounded over a long time these difference can be significant).

4) If you think you may have any IR35 risk even if paying dividends believing you are not caught then company contributions would probably be better because these are still an allowable expense in the deemed salary calculation.

5) The sort of contributions you make depend on your provider. But ther is nothing in principle wrong with making both company and personal contributions.

That's about the summary of the plentiful discussions, there is no one size fits all type answer.

[Fred Bloggs]

Anybody would be very wise to get as much money out of their ltd co as possible IMHO before they bring in the married couples business tax. I think their is some evidence too that a high cash balance in the co brings the hmrc sharks sniffing as well if you look like an ir35 target.