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I just wish to run this past my friends here ?
My Company is doing well and I come to end of my Third Year
And I am looking forward to year 4 Starting in April 2019
At present I am funding my Pension via the Company which is very Tax efficient I am 60 so I can access my Pension Fund at anytime so my funds are not locked away
But Landlord in me is saying divert the Pension Premium's into deposits for new Purchases
I need 25% deposits plus costs and I can Borrow fixed rate at 3.5% for 5 years I would prefer a 10 year fixed but they are few and far between
Both Pension and Buying Leveraged BTL have pluses and negatives the main draw back for me is if I take income from the Company and being a 40% tax rate I pay so much in Tax and NI if I take salary and if I take dividends the tax rate is very high too So I cant win
On the other hand if I use my Company pension I have a fund of money I can dip into and take some of the fund tax free leavening the rest to grow tax free
I have self employed earnings so I can still fund my Pension and its a good hedge against S24
I am at a bit of a crossroads and I am not sure which way to go
BTL is effort and work Pension is Armchair but its boaring
what would you do at 60 I have enough to live on with my currant BTL ect
So what would you do Stick to Pensions with lots of tax free brakes or do I dive back into leveraged BTL
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
We're same age and have company also, but no provision for pension in Co.
What is your need? This will drive your strategy. For us at this time of life it's more about only increasing income enough to fund becoming more hands off going forward over the next 5 to 10 years. Btl is our only income and we don't need to increase it loads There's already enough equity in portfolio so we only need do 1 or 2 more blt's and look at other investments to diversify.
Thank you for the input
BTL has been such an important part of my life and I find it addictive
I love doing a deal and managing the business
it gets me out of bed in the morning
and I love the challenge
but is it worth it with so much tax to pay
and we never know what strokes the government is going to pull next
Sounds like you need to keep doing what you've been doing! I know what you mean about being addictive. You're obviously very good at it and have been very successful. Why not do more, especially with tax mitigation through a Co. Good luck!
the company has been a good move for me
and yes tax mitigation is top of my list
I find pensions so good it’s hard to think of a very good reason to buy more property
basically it’s going to be a 55% tax bill if I want income or take the profits if I was selling
is it worth the effort and risk for 45p in the pound profit
I’m not sure it is to be honest
Firstly congratulations on your achievements. I would first look at IHT planning.
For me it would be pensions with a twist!
Pension freedom allows you to potentially to pass funds tax free to the next generation. Also depending on you're pension situation you could invest pension money intp commercial property.
You are 100% right
the new freedoms are very good
I read a book called pension magic and it highlighted what your saying
lots of plus points in a sippy
Or a SSAS!
What do you think your tax rate would be if labour formed the next government, my guess is significantly higher. Take the income now or put the money in your pension.
Oh yes I agree with you
every time I look at this topic it comes back to the same thing
BTL highly taxed
pensions are not
and politically who will goven us next
If you take an income from the pension then that may also be highly taxed, if the higher tax rate increases it will be for all income.