Pension top-up- is it always best to increase employee contributions?

[lechatnoir]

I’ve recently taken on a second job and would like to use part of the income to boost my pension. Both workplace pensions are at maximum employer contribution but I can obviously increase my own % contributions or should I just set up a monthly standing order into my pension pot fund (mixture of small old pensions combined).

It’s less faff to have it come straight from your salary in terms of the tax relief.

IMHO if you can afford it yes.

If you ask for it to come straight out of your salary it will be cheaper for you as you will get tax relief

Do you not still get the tax relief if you make a direct contribution to a pension provider? I guess the only benefit of Increasing employee contributions is the faff Although I was wondering whether it’s more tax efficient as it would be reducing my taxable income. We’re only talking a few hundred pounds so not a huge sum of money but still if I can make a tax saving, I will Do it this way

Saturday sacrifice is pre tax, so no faff ensuring you get the correct tax relief.

You can pay into a personal pension outside of work but you may need to do a self assessment to get the tax back correctly.

You have to claim it back usually if you make direct payments not via paye so there’s extra steps that way.

Not true unless you’re a HR tax payer. Basic rate is added by the pension company

With salary sacrifice you will also make a saving on your national insurance as well as tax.
if paying to your pension via standing order you will only get tax relief, not NI.

Thank you - I’m going to up my employee contributions from my main workplace. Not sure how much difference the extra £150 will make at this stage as my pension pot is pretty measly, but if nothing else, it might buy me a nice holiday when I retire!