A sole trader pays pension premiums into a personal pension scheme for years. He then incorporates and the company pays the premiums for him. I put these payments through his directors loan account but now wonder if the company can't clam tax relief on these payments. Thanks for any comments.
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It depends. If they go to the DLA then he can still put them on his personal tax return and extend his basic rate band to get higher rate tax relief if relevant. The point is that personal contributions are made net of basic rate tax. Yes the company can now start to pay them BUT the pension provider now needs to know that it is an employer gross contribution and not a net personal contribution. In this case the employer monthly cost will be 25% more than the employee net cost butwll be the same in the end after the company corporation tax relief.