No matter what stage of your life you are at, it is always important to plan for the future by choosing a pension plan that best suits you. Pensions for contractors are big news post IR35. They represent one of the few remaining tax breaks available to contractors and if you are not already doing so, it is important to maximise the allowances available for you to invest.

As a contractor operating through a limited company you could invest money into a pension directly through your businesses bank account. This allows you to not only save on the income tax that would normally be payable but you also avoid the employers and employees national insurance contributions. These funds will then grow in a tax-free pension fund representing the most efficient way for you to benefit from your contractor pension.

There are two main options when looking into pensions as a contractor:

Personal / Stakeholder Pensions and

Executive Pensions

Which is more appropriate will depend on your individual circumstances as a contractor. At Arleys we would recommend speaking to a financial advisor to discuss the option that would best suit your individual needs.

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