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    • Home • Advice • Common questions

    Am I correct in thinking that a SIPP contribution is an allowable company expense?

    25 October 2021

    Question by Mark

    I am 62. I have been personally been paying into a a small personal pension for many years. I have had a limited company for 15 years. This year, I would like my company to put the max amount into a new Sipp (including 3 years carry forward) I understand that I must make an allowance for existing personal pension contributions when calculating how much to transfer.
    Is there anything I haven’t mentioned that I should be aware of before making this decision. Am I correct, that the contribution is a allowable company expense?

    Answered by Boring Money

    Hi Mark,

    On the face of it, it sounds like a really good idea.

    Normally the contribution is an allowable company expense. Your accountant should be able to confirm if for any reason it would not be for you.

    The main thing I think you should be aware of is the Tapered Annual Allowance.

    For every £2 of Adjusted Income over £240,000, your Annual Allowance is reduced by £1.

    This can reduce your Annual Allowance to as little as £4,000.

    Sometimes a SIPP can be more expensive than a traditional Personal Pension so I would suggest you look at the charges too.

    I hope that helps!

    Josh

    Answered by

    Boring Money

    Here to help you understand your options and make smart money choices.

    Important stuffHolly and the team have worked in the finance industry for many years but we are not regulated to give you personal financial advice. For every story on this website about a good investment, or something which went up by 10% or made someone £200, we could also share a story about a bad investment, something which fell in value or lost someone £200. We aim to provide general information and pointers – and btw we are totally agnostic about which providers you might pick – but if you have complex affairs, want personalised advice or need specific recommendations, please look at advice pages and see if regulated digital or traditional financial advice would be the best solution for your needs. Boring Money Ltd is a limited company registered in England and Wales under registration number 09459832 and we have our registered office at 10 Lower Thames Street, London, England, EC3R 6AF.
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    Boring Money Ltd is a limited company registered in England and Wales under registration number 09459832 and we have our registered office at 10 Lower Thames Street, London, England, EC3R 6AF.
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