Limited Liability Company Pension Schemes

Benefits for You, and not for HMRC.  Given the constant challenge of running a business, Contractors will dream of early retirement. Hard graft and grief should give way to the longest holiday of your life but instead of endless days on the golf course in a foreign land many people are forced to carry on working late into life, only to then retire in relative poverty.

The hard truth is that, without the benefit of a large company retirement package and with state provision woefully poor, you will be reliant on whatever nest egg you can build up for yourself.

The good news is that there are very compelling tax planning opportunities now associated with pension investment which could enable you to slash the proportion of your corporate and personal income that goes to HMRC.

Personal Contributions - Contractors can now personally invest (i.e. direct from your private bank account) up to 100% of salary into a pension and still benefit from income tax relief at your highest marginal rate (i.e. the government could be paying £4 for every £6 that you contribute).

Company Contributions - Business Owners may choose to draw a tax efficiently low salary (to help reduce National Insurance) which will limit the scope for personal investment but this need not limit your ability to reduce company and personal tax bills by making a pension contribution. Thanks to 'pensions simplification' you now have massively increased scope to invest if you get the company to fund the scheme on your behalf. 'Employer' contributions can be as much as £255k pa, representing a very tax efficient method of transferring money from company into personal hands. In good trading years a hefty corporation tax bill could potentially be reduced to nothing.

Your pension can also become a central plank of your business by exploiting the freedom to own commercial property. You can hold business premises via a Self Invested Personal Pension (SIPP) with the pension in turn charging your company rent, helping to inflate the size of the pension pot even further.

Subject to minimum ages, you can now invest into the pension to cut your tax bill today, immediately withdraw 25% of the fund tax free and yet not even formally retire.

Where can I get more information?

The advisers at ContractorFinancials, the IFA that we have teamed up with to offer our JSA Financials service, would be happy to recommend a number of investment opportunities to suit your individual requirements. They can offer consultations via email, telephone or in person and pride themselves on their specialised knowledge of Contractor pensions.

As Independent Financial Advisors they are able to offer advice on your existing investments alongside the JSA Financials scheme and would be happy to offer you an unbiased opinion.   To find out about the scheme and to receive a personalised quotation please call 0845 202 4534 or email pensions@JSAfinancials.com

Financial advice is given by ContractorFinancials, which is a trading name of ContractorFinancials Ltd and is regulated and authorised by the Financial Services Authority.

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