Payments into pension

[Cazziebo]

I've taken on an non exec director role on a PAYE basis. I'd like the full fee to go directly into my existing pension. My accountant says good idea, tax effective etc. My pension provider says it's not possible - I have to pay it in myself via a regular contribution (therefore after tax earnings) or the employer has to do a one off payment every month with the attendant paperwork which I don't want to burden with them.

I realise the person I spoke to is a call handler rather than a pensions expert, but do any of you wise people know what's possible here?

Can’t you then claim the tax back on your self assessment if you pay it into your pension yourself?

Ask your accountant how to go about it.

Some pension companies will claim the tax back directly from hmrc for every £1000 payment you send HMRC send £250 4-6 weeks later .
Depends On type of pension.
I just make a manual payment myself every month .

I would think you’d do it via salary sacrifice, which means it is paid gross by the employer every month and you will get a payslip saying e.g salary £1000, salary sacrifice £1000, taxable income £0.
There should be no good reason why your pension provider can’t accept a gross monthly employer contribution via direct debit or standing order, usually it is a case of using the correct terminology when you ask.

Also double check with your payroll dept as to whether you can salary sacrifice into your own existing pension scheme or whether it has to be their workplace scheme (which you could always amalgamate later) - some companies will only pay into their own pension scheme as the admin burden would be too great if paying a different pension provider with a different set of processes for each employee.

I formerly had pension contributions made by salary sacrifice and paid gross from payroll to my pension company.

HMRC for some reason alleged that we were getting tax rebates on untaxed contributions (this was not true) and carried out some kind of investigation which was extra work for the employer and they stopped doing it for me.

Contributions you make yourself will get the tax rebate, but National Insurance contributions will be due so it is not such a good deal.

If you are a PAYE employee and you don't want to "burden" the employer with doing it, then I think you will have to make your own contributions from taxed income.

Have you asked your employer if they can and will do it? If they are using a major payroll package or a payroll agency, it should be a standard process.

Thank you all for your input. The company outsource it to a payroll provider but I think it's a one man band (or perhaps one and an assistant!)

you should at least ask.

What rate of tax do you pay?

I do similar, but I cannot have my employer pay in direct as I have a company pension with them that is career average public sector.

I pay in to my pension myself then once I receive the money, the pension company claim the 20% tax back. HMRC were willing to adjust my code for allow for £10k of contributions but the rest had to be claimed back with self assessment, even thought they keep telling me not to do self assessment! In the end I complained and now have the tax code correct which means effectively I'm getting tax relief at 50% for part of my contributions due to keeping child benefit as well