Business funding options for your clients.
At Opus Business Pensions, we work with accountants to provide a range of business funding options, adding value to your service and ensuring your client’s business goals can be achieved.
Providing Added Value to Accountants
Accountants throughout the UK know how stressful year-end tax planning for a company can be. To add to this stress, FD’s and Directors will be leaning on their accountants for some clever corporation tax planning.
The mere suggestion of a large company pension contribution falling on deaf ears is likely a familiar sound too. This is sometimes because advising the company FD or perhaps the Director to make a large or even small contribution faces them with a classic dilemma, at BFS, we believe the immediate thinking will usually come down to this.
Directors’ perceptions on making a company pension contribution
Contributing a large share of profits to a company pension fund will improve the tax position, but at the cost of damaging precious cash-flow by locking up the hard-earned capital until age 55.
In other words, the business cannot access the capital until the pension owners (or members) re able to realise the pension benefits in future years. For this reason, they may decide to take a hit on the corporation tax whilst retaining the benefit of this useful capital.
But is there an alternative method?
Not all pensions act the same. Looking at the currents trends in corporate pension planning, the Small Self-Administered Scheme (SSAS) could be a far better tool to manage both a company’s tax burden and capital requirements.
Paying a large contribution of profit into a SSAS pension will give a company the required corporation tax relief, while the rules of the SSAS pension allow the scheme members to trigger a loan-back for some, or all, of the contributions originally made by the company.
This means larger company pension contributions can be made with confidence, and the benefit of not locking up all the capital, or waiting until age 55.
So, what’s next?
At Opus Business Pensions, we understand that tax planning at this level should always be carried out by the company accountant, but we believe the setting up of a SSAS should always be done through a fully qualified IFA.
The IFA will perform tests on the level of allowable annual pension contribution and the underlying investments to take full advantage of this simple but very effective tax mitigation strategy.
Our team of IFA’s at the Opus Business Pensions have deep knowledge and experience in this type of specialist company tax planning, and the specific requirements for setting up your own company SSAS pension scheme.
Opus Business Pensions, has a close working relationship with many accountancy practices in the UK, providing them with a range of funding options that they can recommend and offer to their clients. If you would like to find out more about our service, give one of our team a call today on 0121 725 0099 or fill out a contact form and we’ll get back to you.