I can pay up to £40,000 into my pension right?

[EqualFranknessWithYourLadyship]

I have recently become employed again after many years of self-employment. I earn at higher rate but my employer only makes basic contributions.

I still have £80000 just sitting in my old company bank account. Am I right in thinking I can make a top-up payment from the company bank account to make it £40,000 paid in this year?

thank you
ps my accountant is rubbish and has vanished which is why I’m not asking them!

Is that your own company, is it currently trading and are you a director? Is that your employment, is that what you mean? If yes, what is your directors loan account sitting at?

I'm not sure I know but i think those questions may be relevant.

Hmm, think it's capped at taxable earnings? Or something about tax benifit capped at taxable earnings? I'd check those details out - unless you can pay yourself the money from the business and 100% to pension?
You need proper advice, even if you get an idea from random on the web about what might be possible.

The annual allowance is currently £40,000 for most people.

However, you can also only receive tax relief up to 100% of your earnings.

So if your earnings are lower than £40,000 you'll be entitled to tax relief only up to the amount you earn. If you earn less than £3,600, you can pay in up to £2,880 and still get tax relief.

www.moneyhelper.org.uk/en/pensions-and-retirement/tax-and-pensions/the-annual-allowance

The £40k limit includes any contribution from your employer and any tax relief.

So without any employer contributions the limit is £32k as you get £8k tax relief added to the £32k adding up to £40k.

You will need to check how the pension contributions by your emplyer are made and how much they are and determine what tax relief on those you need to deduct from the £32k too.

Make sure the pension exists in this financial year then from April you can use this years allowance as well as next years.

The limit is £40k or your full salary whichever is lower but tax relief does taper off for very high earners. www.gov.uk/guidance/pension-schemes-work-out-your-tapered-annual-allowance
You can’t just take money out of your company account, it needs to be accounted for as dividends.

If it’s paid to you as a dividend, you can’t put it on your pension. It needs to be paid as salary.

your company can make an employer contribution of any amount up to £40k. This is a company contribution not an employee contribution so it isn’t capped at the salary you’ve drawn from the company.

it isn’t a dividend. It goes directly from the company to the pension.

Thank you all.
my annual allowance isn’t tapered, I don’t earn that much.

the challenge is that I earn more than £40k from company A (my employer) but want to make the contribution from company B (my old personal services company).

You can do it so long as your scheme accepts it (may not if it is a personal scheme) it won’t reduce your personal tax liability because you will have paid employer contributions, but if you create a loss in the year you can then do a loss carry back claim for corporation tax if you have stopped trading and get the tax refund, or carry forward if you are continuing to trade (corporation tax rates are increasing for profits over £50k so this is what I’d do). If you have an active scheme and the annual allowance available from previous years why not stick in the full £80k?

Ps when looking at annual allowance don’t forget to account for any pension paid by your current employer - it is likely you will have used up some of this years £40k AA already.

If you didn't maximise your annual allowance in the last three tax years you may also be able to use "carry forward". Which is basically any unused allowance from the last three years.

I would get a new accountant for start. I have back used 3 years worth of allowance.

“it won’t reduce your personal tax liability because you will have paid employer contributions,”

I don’t understand this bit?

I think PP means it won’t reduce your personal tax, i.e you won’t get tax relief on it because it’s paid from the ltd Co. rather than from your salary for example.
However it means you’ll pay less Corporation tax.
I would say you need to find a new (better) accountant though!

This. Your company can make contributions directly, not via dividends or salary to you first. Saves corporation tax.

This. It’s an Employers contribution. It reduces your corporation tax too. Assuming your personal services company is still trading. You can also backdate conts, but will need to consider what your current employer and you have paid in.

get some proper advice tho!

Get some independent advice. If you can't put it into your new company pension you can put it into a private pension instead. You may not get full tax relief but at least you'll be earning decent interest.
Check that you are maxed out on tax free saving and investment options.

Yes another for @User76765 advice don’t listen to other people talking about dividends and your personal allowance

i'd say get independent financial advice as that’s something your accountant can’t give. I was advised because of my age not to pump cash into my pension as I had lots of pension paying years ahead of me (and I am maxing them out) sorry to hear your employer is rubbish at matching yours

I went down the voluntary liquidity route for my old business cash

Could you clarify the need for a better accountant,because I didn't quite understand.

My year end is November. I passed them my FreeAgent figures a few weeks after. In May they managed to file the return. And now 14 months later they still haven’t reclaimed the excess employers paye contributions I made.
I turned up there physically the other week - it made no difference.

Don't ask Mumsnet check with the guides on line it with HMRC. Or better still get an adviser

Some of the information on this thread is so misunderstood and technically wrong

I think if its your own company and you pay yourself dividends you can pay more in, this is where a decent financial advisor or accountant is worth their weight in gold