Setting up a pension after becoming self employed

[DCINightingale]

Oh wise mumsnetters, please help! I am totally out of my depth.

Last year DH quit his job to become a freelance contractor. We have set up a limited company and the work is going great. I am currently a SAHM but the idea is when the kids go to school I can start doing some of the contracting too. The money goes into a business account and we pay a set amount out into our personal joint account each month as a salary. The rest is just currently sitting in the business account.

We need to set up a pension, somewhere to invest that extra money. This is where I start to struggle. Does anyone have an idiots guide? I'd like something simple to manage, ethical, where we can pay possibly irregular amounts into (i.e not necessarily a fixed monthly amount)

I google and Google and all I get are the same articles of advice but that doesnt seem to lead me anywhere. I want to actually see some products, where do you find those? Does anyone have any recommendations for pension products? Or where we need to start?

We have had a call with someone who does pensions, but he was representing one particular pension and a "we do it all for you" service, which is great but I am aware normally the people that seek you out like that dont always offer the best deal so I'd like to do some independent research make my own mind up.

We are in a similar position and have a SIPP with Hargreaves Lansdown
However, you do need to have a bit of an interest in shares really

[quote pawcontrol]@OnceUponAThread I wonder if my pension supplier didn't really understand what I was asking when they said it was fine to change. I was hoping to put it as a business expense so corp tax by contributing to the pension from the business.

Our accountant has mentioned it was complex, but she is more of a book keeper and isn't very knowledgable on certain things. We had a proper big company doing our accountants before and I regret changing to save some money. [/quote]
Which pensions company are you with?

Need to make sure it's going in as company contribution rather than a personal one. Or it will cause tax chaos.

I am with Vanguard. So when I go into the pension I have options.

Make a personal contribution from my own bank account - which I can do as a direct debit.

Make a company contribution - which I do from the business account (not allowed to be direct debit infuriatingly).

Third party (if someone else wanted to pay in).

I pay all from company to reduce corporation tax. (Also because my income is mostly dividends for tax purposes). Works for me, but finding a good, low cost provider that would do it straightforwardly was a pain.

Use PensionBee - they are really easy to deal with and you can make company contributions and personal ones. Talk to your accountant about doing this in the most tax efficient way. (Perhaps also speak to them about dividends rather than salary as they may be more tax efficient).

@OnceUponAThread I'm with Scottish widows.

I’m with LVE but would look at pencils if setting up again.

Use a financial advisor. Yes you will pay for their advice but your pension will be actively managed. As a director of a limited company you can pay up to £40k a year from the company into a pension as long as you have the profits to do so and then you don't pay corporation tax on that amount.

Tell your accountant at your year end you want to pay the max into your pension.

@OnceUponAThread why can't it be a DD to vanguard from
Business acc? My DP has sent up with this a few days ago coincidentally, so nice to read on here it's also recommended and so I have just opened one too. I will transfer my various other tiny pension pots in and start making a bigger monthly contribution from the business.

[quote pawcontrol]@OnceUponAThread why can't it be a DD to vanguard from
Business acc? My DP has sent up with this a few days ago coincidentally, so nice to read on here it's also recommended and so I have just opened one too. I will transfer my various other tiny pension pots in and start making a bigger monthly contribution from the business. [/quote]
@pawcontrol - god knows why. It's infuriating. I've called them several times about it and they just say they don't offer direct debits for company contributions like that.

Even more infuriatingly - you transfer the sum to cash and then have to allocate it. It won't do it automatically.

The good news is I forgot my March contributions and this thread reminded me so I have now done them. Phew.

I am happily using both Vanguard and Nest.

Not because of any deep knowledge on the whole pensions subject but after some research they did what I needed.

Why two providers? Just not putting all the eggs in one basket and some hedging of bets.

Best wishes with whatever decision you make. Remember it's for the long haul (I haven't dared look at my accounts in the last month!)

Thank you for posting this thread - it gave me the much needed boot up the bum to finally sort out a SIPP (with Vanguard).

I had an old Std Life pension from an old job and my uncle is an IFA so he reviewed the performance and fees and said on balance it was a pretty good option so I just rang them up and transferred it all over to my Ltd company with me as only employee.

I do a regular standing order from the business and can also do one off dumps about this time of year to put what I can in and away from the tax man