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Why would anyone pay over £60k a year into pension?

52 replies

Whitesky75 · 27/08/2024 17:23

that really. Are there any other benefits in saving more that £60k a year in a pension wrapper?

OP posts:
IvyIvyIvy · 11/10/2024 08:36

You don't get taxed on it when you put it in. Then you can invest in equities and grow it without any capital gains tax. It passes inheritance tax free. And it helps you get your income down to below thresholds to receive childcare hours etc.

ispecialiseinthis · 11/10/2024 12:13

IvyIvyIvy · 11/10/2024 08:36

You don't get taxed on it when you put it in. Then you can invest in equities and grow it without any capital gains tax. It passes inheritance tax free. And it helps you get your income down to below thresholds to receive childcare hours etc.

If your exceed your pension allowance for a financial year (and the previous 3 years’ pensions are not sufficiently under-filled to back fill with the excess) then you will be taxed.
Unfortunately, the money you are taxed on (i.e the excess pension contributions) is not money you can access until you retire. Or Whereas, if that excess money was in your current account, you would tax on it as normal and have the remainder to spend as you wish.

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