<p>As a <a href="https://www.goforma.com/limited-company/what-is-a-limited-company" target="_blank">limited company</a> director, you can make pension contributions as an individual (as an employee), as well as through your company (as an employer).<br></p><p>Most directors make pension contributions from their company. This is a tax efficient approach, as employer pension contributions are an allowable business expense, which means that your company doesn't need to pay corporation tax on pension contributions made.<br></p><p>You won't need to pay tax on your contributions, as long as it falls below your <a href="https://www.gov.uk/tax-on-your-private-pension/annual-allowance" target="_blank">annual allowance</a> (capped at £40,000 for 2020/21), and your pension benefits doesn't exceed the <a href="https://www.gov.uk/tax-on-your-private-pension/lifetime-allowance" target="_blank">lifetime allowance</a> (£1,073,100 for 2020/21).</p>
Accountant For A Limited Company
How do I make pension contributions through a Limited Company?
A UK limited company can pay pension contributions for directors and employees as employer contributions into a Self-Invested Personal Pension or workplace scheme. Employer contributions are deductible against corporation tax at 19% or 25%, are outside employer and employee National Insurance, and count against the same £60,000 annual allowance as personal contributions. Carry-forward of unused allowance from the previous three tax years can enable larger one-off contributions.
