Reply to: Pension for Dumbies

[Fred Bloggs]

Hi,

Well, Landsdown H account created, even invested in my first tracker - Fundsmith.

Emailed account, telling them about the creation of my SIPP and plan to shovel off £300 a month.

Cheers guys.

Simon

Well done. But just so that you know, Fundsmith is an excellent choice for your SIPP, but it isn't a tracker. It has made excellent returns the last five years, where a tracker would have tracked the chosen index and gone pretty much nowhere. If you go to the Fundsmith website you can download their "owners manual". Well worth reading.

[kaiser78]

Seek the advice of an IFA - they normally offer the first hour consultation FOC. You can pick their brains during this time.

[Alan @ BroomeAffinity]

Know anyone that could help him out Alan? [emoji6]

Why, Mr Nluk, I couldn't possibly say. [emoji3]

[northernladuk]

If your accountant isn't helping you with this, then he's probably not helping with lots more your don't realise. Get yourself an accountant who will provide advice based on real time info, not compliance.

Know anyone that could help him out Alan? 😉

[Alan @ BroomeAffinity]

They probably can't advise you on the best pension, but they can tell you that a company pension contribution is tax efficient. It's a legitimate expense, so will reduce the profit (and therefore CT and dividends). Pay 50% tax, then your company pension contribution is double what you'd be able to make personally. Which is nice. The downside is that you have to wait to spend the money.

Was just about to post pretty much this. Saved me the bother.

If your accountant isn't helping you with this, then he's probably not helping with lots more your don't realise. Get yourself an accountant who will provide advice based on real time info, not compliance.

[SBK1972]

Hi,

Well, Landsdown H account created, even invested in my first tracker - Fundsmith.

Emailed account, telling them about the creation of my SIPP and plan to shovel off £300 a month.

Cheers guys.

Simon

[Lance]

They probably can't advise you on the best pension, but they can tell you that a company pension contribution is tax efficient. It's a legitimate expense, so will reduce the profit (and therefore CT and dividends). Pay 50% tax, then your company pension contribution is double what you'd be able to make personally. Which is nice. The downside is that you have to wait to spend the money.

and may have to pay tax when you take it out. Depends on many factors, not least that the rules may change before you get to 55.

[VectraMan]

Accountants cannot advise you on pensions. IFA's can, but in my opinion are a waste of time (and money). Search here, there are many posts about this, some by me. Then come back with more informed questions and we will help you further.

They probably can't advise you on the best pension, but they can tell you that a company pension contribution is tax efficient. It's a legitimate expense, so will reduce the profit (and therefore CT and dividends). Pay 50% tax, then your company pension contribution is double what you'd be able to make personally. Which is nice. The downside is that you have to wait to spend the money.

[northernladuk]

And forget the Accountant that charges you by the second.

Don't forget him, change him.

[Fred Bloggs]

Thanks Saptastic.

Will read and get this sorted.

Simon

If I were you, I'd download the various free pdf's from Hargreaves Lansdown website that relate to pensions and SIPPs in particular. They are very good.

[SBK1972]

Thanks Saptastic.

Will read and get this sorted.

Simon

[saptastic]

Hi all,

Recently had to set up a pension scheme for my ltd company. Im 44, been contracting a few years. I dont have a pension, my plan was to down size my house, and some other properties.

Originally I was going to get my wife to `opt` out the minute this was all set up as I assumed lots of costs/ admin. However, people keep telling me that there are tax advantages to keep it going. I'll admit now, accounts isnt my thing, so how does keeping this pension thing going, within a contractor / IT Ltd company, bring advantages ?

I pay alot of corporation tax, so by contributing to a pension will it reduce it ? Will it effect dividends ?

Am hoping another contractor on here can help / advise. My accountants charge me per a second of advise.

SBK

Contractor pensions advice :: Contractor UK

Contractors' Questions: What are my pensions options? :: Contractor UK

Speak to an IFA - there are contact details on the links.

And forget the Accountant that charges you by the second.

[SBK1972]

Hi all

Thanks for your replies. Yes my accountant is pretty poor and unhelpful and Im looking to change that.

Just did a search on the forum to try and read up on the subject, you guy's dont suffer newbies / stupid questions do you. Perhaps you guys forget that you have to start somewhere and although I search google the mass of information is overwhelming so you pop on to try and get a more ` down to earth / honest` understanding :-)

From reading the few replies, and UK Contractors advice page, it seems that I can set up a pension and through in money from my company, reducing CT.

I will go seek a IFA and go from there, taking what they say with a pinch of salt as advised above :-)

SBK

[Fred Bloggs]

Accountants cannot advise you on pensions. IFA's can, but in my opinion are a waste of time (and money). Search here, there are many posts about this, some by me. Then come back with more informed questions and we will help you further.

[Lance]

sack your accountant

pay into a pension. Search the forums here if you're interested in a SIPP. Or find an IFA (but take a pinch of salt with their advice).

/advice