SIPP with umbrella

[Wonko]

So, my clients' response to IR35 is to stop using PSCs so I am forced to go with an umbrella.

One of my main concerns is my pension - I have a SIPP and would like to be able to continue paying into it, using salary sacrifice which seems the only sensible option.

Are there any FCSA accredited umbrellas which will pay straight into my SIPP?

I have a long list of Umbrellas which my client's outsourced HR will accept, but I've been unable to find out much short of phoning them all about how their pesnion arrangements work.

[lucyclarityumbrella]

So, my clients' response to IR35 is to stop using PSCs so I am forced to go with an umbrella.

One of my main concerns is my pension - I have a SIPP and would like to be able to continue paying into it, using salary sacrifice which seems the only sensible option.

Are there any FCSA accredited umbrellas which will pay straight into my SIPP?

I have a long list of Umbrellas which my client's outsourced HR will accept, but I've been unable to find out much short of phoning them all about how their pesnion arrangements work.

Most won't as it means having to manage a different pension for every single contractor which is a logistical and administrative nightmare, best option is to find one that will allow you to move the money once your assignment has finished at no cost back into your SIPP. And please, please, please do phone them, at the end of the day they are going to be handling your money make sure you feel comfortable with them, its way too easy to just be an online business that offers no actual customer service

[contractor_coop]

So, my clients' response to IR35 is to stop using PSCs so I am forced to go with an umbrella.

One of my main concerns is my pension - I have a SIPP and would like to be able to continue paying into it, using salary sacrifice which seems the only sensible option.

Are there any FCSA accredited umbrellas which will pay straight into my SIPP?

I have a long list of Umbrellas which my client's outsourced HR will accept, but I've been unable to find out much short of phoning them all about how their pesnion arrangements work.

As Lucy said, many umbrellas do not offer the option of paying into SIPPS, but I can tell you they do exist.

[coder]

Most won't as it means having to manage a different pension for every single contractor which is a logistical and administrative nightmare, best option is to find one that will allow you to move the money once your assignment has finished at no cost back into your SIPP. And please, please, please do phone them, at the end of the day they are going to be handling your money make sure you feel comfortable with them, its way too easy to just be an online business that offers no actual customer service

Isn't the advantage of coming off gross not that it saves NI?

[eek]

Isn't the advantage of coming off gross not that it saves NI?

Yes - you should get the employer NI contribution which you would otherwise lose (but best to explicitly ask the question to the umbrella company).

It's why I didn't get some other posters comment that a 1% pension fee was hideous. It's not great but the thing that is most important is the overall fee to get the money into your SIPP (if so desired). Which means you need to know the total figure for initial purchase, management and any exit fees - and that could differ significantly by pension company.

[rootsnall]

Yes - you should get the employer NI contribution which you would otherwise lose (but best to explicitly ask the question to the umbrella company)..

Contractor Umbrella just fell over on this question in that the pension contribution came out of what was left after Employers NI had been deducted. Not sure if I didn't ask the question properly or if that is how it works with them. Has anybody got any names of umbrellas that will allow you to pay into a pension from the Gross ( pre Employees NI ) ?

[DolanContractorGroup]

Contractor Umbrella just fell over on this question in that the pension contribution came out of what was left after Employers NI had been deducted. Not sure if I didn't ask the question properly or if that is how it works with them. Has anybody got any names of umbrellas that will allow you to pay into a pension from the Gross ( pre Employees NI ) ?

Hi rootsnall

I think you've asked two different things here.

The employers pension contribution is calculated after the margin and employment costs have been deducted. And we calculate the employees pension contribution from the gross taxable. The two aren't mutually exclusive.

The advice we give to our employees is that you can set aside, through umbrella payroll, as much pension contributions as you want, and then have them transferred over from our Scottish Widows provider to your own scheme. There aren't charges for this.

Hope this helps.

Kind regards


Zeeshan

[rootsnall]

Hi rootsnall

I think you've asked two different things here.

The employers pension contribution is calculated after the margin and employment costs have been deducted. And we calculate the employees pension contribution from the gross taxable. The two aren't mutually exclusive.

The advice we give to our employees is that you can set aside, through umbrella payroll, as much pension contributions as you want, and then have them transferred over from our Scottish Widows provider to your own scheme. There aren't charges for this.

Hope this helps.

Kind regards


Zeeshan

Are the 'employment costs' the 12% Employers NI ?

[DolanContractorGroup]

Are the 'employment costs' the 12% Employers NI ?

Hi

The 13.8% Employers NIC is one of the costs. There is also the apprenticeship levy.


Kind regards

Zeeshan

[lucyclarityumbrella]

In simple terms - paying into a pension via salary sacrifice will reduce all tax and NI contributions