Can I take money from my limited company to pay for a pension?

17 April 2023

Question by Sue

Can I take money from my limited company to pay for a pension?


Answered by Steve Kilfoyle

Hi Sue, in short, yes. This is one of the most tax-efficient ways to invest into a pension. Effectively you would get no personal tax relief on the contribution (Should you invest £100 from the limited company it would go into the pension as £100) but your payment could be offset against your corporation tax bill. Therefore you do not draw any money via salary or dividends, therefore, being able to keep the payment away from any personal taxation. You must consider your own personal allowance, this was increased from £40,000 to £60,000 in the recent budget to come into force in tax year 23/24.

Answered by

Steve Kilfoyle

Financial Adviser

I work for a multi-award winning Chartered firm based in the South East and have been an adviser for 22 years. I provide holistic financial advice and pride myself in delivering straight-forward, plain speaking advice tailored to individual clients' needs. Financial planning can seem daunting, but that's what advisers are here for - I am able to provide an impartial view.