I am running my own business, am a self employed Director. My salary is circa €150k per year.
If I pay a pension of say €30k per year, will this reduce my income tax liability AND my corporation tax liability (assuming I have profits liable to CT).
Also what tax savings am I likely to achieve on my income tax?
I did a very rough calculation:
No pension: 150kGross Pay x 41%tax = 61.5k tax liab = 88.5 net pay
Pension: 150kGross Pay - 30k pension X 41%tax = 49.2tax liab therefore
120k (150-30) - 49.2ktax liab = 70.8knet pay.
Result is:
Net Pay reduced by 17.7k from 88.5k to 70.8k.
Pension of 30k gained.
Am I on the right track?
If I pay a pension of say €30k per year, will this reduce my income tax liability AND my corporation tax liability (assuming I have profits liable to CT).
Also what tax savings am I likely to achieve on my income tax?
I did a very rough calculation:
No pension: 150kGross Pay x 41%tax = 61.5k tax liab = 88.5 net pay
Pension: 150kGross Pay - 30k pension X 41%tax = 49.2tax liab therefore
120k (150-30) - 49.2ktax liab = 70.8knet pay.
Result is:
Net Pay reduced by 17.7k from 88.5k to 70.8k.
Pension of 30k gained.
Am I on the right track?