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Employer pension contributions

Employer pension contributions

A self employed financial advisor employs his wife on a monthly salary of £680. He wants to start contributing to a pension for her of around £300 a month. Would I be correct in thinking that the contributions will be treated as salary on which she will be taxed or can he set up a company scheme for her and get tax relief on the contributions without  it being treated as her salary or are there any other suggestions ? Thank you

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14th Mar 2012 15:38

New pension scheme

there is nothing to stop the setting up of an employer scheme for the wife/employee, but bear in mind that contributions will only be allowable for tax if they form part of a remuneration package which is at a commercial rate - excessive contributions will be disallowed. Employer contributions do not form part of the salary, and would not be taxable on the employee.

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14th Mar 2012 16:32

New pension scheme

Thanks for your input Steve. Most helpful.

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