I have a husband and wife running a company part time who have other sources of income and want to use the profits of the company for future retirement. They are basic rate tax payers and want to keep this simple. The amount to be paid would be deemed reasonable for work undertaken and therefore a trading expense.
Leon Ruward
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No.
The issues are allowability against corporation tax and keeping under the £215K annual allowance limit.
NeilW
Errrr
Yes - sorry read the question again which is posed negatively - No - no reason.
If you are happy that it represents as a total salary package - ie salary + benefits (of which the employer's contribution is just one, albeit exempt) - a payment which is for the purpose of the trade - then it should be just as likely to be allowable for CT as a salary. The revenue's latest guidance makes it clear that it is the package which must be tested for excessive character, not the pension contribution by the employer as a limit.
Then as long as the fund doesn't increase by more than £215,000 you should be OK