Sipps - through company or personal? - Contractor UK Bulletin Board

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ASB replied

18 October 2006, 12:10
Define in your own mind better. Then read this. http://forums.contractoruk.com/threa...10-relief.html
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hugebrain started a topic Sipps - through company or personal?

18 October 2006, 11:41
Sipps - through company or personal?

Hi,

I'm foolish enough to want to put some of my hard-earned cash into a SIPP.

I believe the Company could pay into the sipp directly and get a reduced tax bill because it would have lower profits.

Alternatively, the company could pay out a dividend and then I could put the dividend into the sipp and claim back tax at 40%.

Which is better and why?

I'd think that the second option would be better because you would pay tax of 34%? and get back 40%, but I never understand tax so I'm probably wrong.
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