Pension contribution avoiding NI

Pension contribution avoiding NI

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I'm the sole employee and director of a one-employee company . I want to pay a lump sum into my personal pension scheme (stakeholder or not). If I do so as an individual then that's tax efficient but I can't avoid paying the employee and employer's NI. I understand that my company can make a payment into a pension scheme but does that avoid the NI? If so, how do I go about it and what are the limits if any? Can an ordinary personal pension or stakeholder pension be used in this way.
Dennis Cook

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By AnonymousUser
26th Feb 2007 15:21

The company, as your employer,
can make a pension contribution to your personal pension which will avoid NI. Make sure it is properly documented in the company's books and that your total remuneration is within "wholly and exclusively" limits, ie is not an excessive expense deduction in the context of the company's trade. The only other limit is the annual £215,000 input to your pension scheme. The pension scheme will have its own forms for employer contributions. The contribution won't count towards NMW.

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