Director's Pension Plan

The efficient running of a business takes a lot of time and effort - your time and effort. The main objectives of a Company Director will be to run his business at a profit and to look after both his own and his Employees' current and future needs. This will, of course, need to be done in a Tax efficient manner. Moving money from the Company to individuals is quite difficult and is not always Tax efficient. Let's look at some examples:-

  • Individual share-holding could be increased in value by accumulating profits within the Company. Profits will, however, be normally liable to Corporation Tax or, if paid out as dividends, may increase Personal Tax Liability.
  • Directors and Key Personnel could pay themselves higher salaries but this could simply mean paying higher Personal Taxes.
  • The provision of company cars, preferential loans, etc., is treated as "Benefit-in-Kind" and so may well increase one's Tax Liability.

What is needed is a simple, straight-forward, Tax-efficient method of enabling the Company to keep its Tax Bill to a minimum whilst looking after the Financial needs of its Directors and Key Personnel. The ideal answer is a Directors Pension Plan. By setting up a properly approved Plan, a number of significant Tax concessions can be gained.

  • Regular contributions by the Company can be fully offset against Corporation Tax as a business expense. It is important to note that such contributions are not regarded as a "Benefit-in-Kind" to the Directors and Employees.
  • Contributions made by the individual are fully Tax deductable - up to a maximum of 150/o of net relevant earnings.
  • Contributions are invested in exempt, approved schemes which are free from all Income, Corporation and Capital Gains Taxes. This means that such funds accumulate without such exemptions.
  • Up to 11/2 times final salary can be taken as a Tax-Free lump sum at retirement

There is no more Tax-efficient way for a Company to set aside funds for the future of its Directors and employees than by investing in a Company Pension plan.

Personal Pension Planning

If you are self-employed, then you have chosen an independent way of life. To a large extent, you can dictate your income level and your standard of living. Financially, it's all up to you. However, this dependence on your own efforts will continue even when you retire. So, how do you put away some of this hard-earned money to allow you to retire in comfort?
The simple answer is Personal Pension Planning.
Personal Pension Planning is probably the most tax-efficient method of saving available to the self-employed or those in non-pensionable employment. Let's take a look at what a properly constructed Personal Pension Plan has to offer

  • You can claim full tax relief on Your contributions (up to 15% of your gross earnings less relevant deductions.)
  • Your contributions are invested in a tax-free fund.
  • At retirement, you can take up to 25% of your accumulated fund as a tax-free lump sum and also receive a pension for life.

The tax "breaks" as discussed above are important in themselves but the return on your investment is also of great importance. Over the years, Pension Funds have out-performed all other methods of saving. It is important that you choose the best possible Personal Pension Plan to suit your needs.

We are in a position to offer INDEPENDENT, IMPARTIAL ADVICE on how best
to fund for your retirement.