Pay some of bonus into pension?

[SB1971]

Am lucky enough to be due a bonus in a month or so -circa £3k before tax.
Work have said we can pay some of this into pension and that wouldn’t then be taxed or ni’d.
This feels like a no brainer to put say 50% in as I was out of work for 6 months a year ago so have a gap.
I don’t especially need all the money for something at the moment but I don’t know whether it is worth it really as it not such a huge amount to go into the pension and won’t make such a difference.
My pension is becoming more of a concern (am 50) as the pots are small and am kind of relying on my husbands nhs one.

Will, work also contribute to the pension as they do with your salary? If so, it’s a no brainer at your age.

Chances are that money will be more use to after you've retired than it will now.

I’m in my 40s, and have put my whole bonus in my pension for a few years now. I figure it is money I’m not budgeting to need normally, so I might as well put it away tax efficiently for later.

soontobe60 I don’t think work would match it they don’t usually on bonuses they usually do a set amount on salary such as 4% contribution.

They won’t match it as am already at the max contribution they match.

If you don’t need the money then it’s a no brainier to put it in the pension. Your pension is essentially just a savings account that you can’t access for a few more years, so why would you pay tax on the money just to access it now?

Put all of it in.

It’s especially good if bonus tips you over £100k and you lose your personal allowance.

I’d put all of it in if my pot was small & I didn’t need it.

Put it all in. Most tax efficient way to deal with it.

Yes, if you don’t need it put as much as possible into pension. That will be £3k going into your pension whereas you would only receive £2300 ish after tax and NI (less if you’re a higher rate taxpayer).

And it’s still got another 15 years or so to gain investment income so definitely worth it.

Thanks all - have just committed to 50% of it into the pension so that should help to bridge some of the gap I missed when I was out of work.

I needed my bonus up until nearly 50 years old to pay normal outgoings. We then paid off mortgage and I could afford to save money.
I started to put all my bonus each year into my pension…I retired at 55 and took this as a lump sum tax free. It was a great way of saving as not only did I gain 40% on tax , I also gained more than base rate bank interest on the investment (if I’d taken it it would have gone into the bank). It made a good tidy and significant sum when I retired. Best place to “save” to if you don’t actually need the money. But I’d say if you don’t have any accessible savings build that up first in an ISA stock and shares you can access before retirement as well e.g. split it