Retirement Planning For Business OwnersIt’s important for you to consider your own retirement needs as well and even if you own the business, don’t rely on selling your company as a guaranteed source of income on your retirement.
Many business owners depend upon the future sale of their business to generate their retirement funds. However, by putting business assets such as cash profits, commercial property or land into a pension arrangement, business owners could:
- Enjoy a number of tax advantages
- Use money paid into the pension fund to expand your business now
- Build up a substantial retirement nest egg.
Pensions can form part of your exit strategy:
- If you plan to sell your business to fund your retirement, paying a large contribution into your scheme will both provide a pension in its own right and reduce the capital gains tax on sale of the company. However, you cannot exceed the lifetime allowance without incurring a tax penalty.
- Pension regulations have recently changed therefore if you plan to contribute a lump sum to your pension, you may find you’re restricted by new limits. Existing arrangements should be reviewed to establish whether more tax relief or higher contributions are possible under the new rules or alternatively whether tax charges will be triggered by them.
Given all the recent tax changes affecting both individuals and companies, this could be a better time than ever for us to review your circumstances so get in touch today.