Bira is always looking to provide independent retailers with financial advice and support.  MoneyHelper provides free, impartial money and pension guidance over the phone and online.

We encourage our members to take advantage of these free services by visiting the MoneyHelper website, or you can call their advice line: 0800 011 3797.

Choosing a pension scheme can be a confusing process, whether you are an employer or a sole trader.  The following information from MoneyHelper is designed to help clarify some of the key details:   

Why save into a private pension?

  • Your business may not provide you with a retirement income or a lump sum at retirement.
  • You may be forced to give up work earlier than you expect due to ill health or caring responsibilities.
  • In the event of bankruptcy, your pension pot is likely to be protected.
  • A pension is one of the most tax-efficient ways of saving for retirement.
  • The State Pension alone is unlikely to provide you with enough money to maintain the standard of living you’d like.
  • You can access your private pension earlier than State Pension (currently at age 55), maybe allowing you to retire earlier.

Choosing a pension scheme

Defined contribution (DC) schemes include personal pensions, stakeholder pensions and self-invested personal pensions (SIPPs). You build up a pot of money by paying regular and/or one-off contributions. The value of your pension pot over time will depend on the amount contributed, how investments have performed and charges applied by your provider.

  • Speak to a financial adviser. A regulated financial adviser will look at all your financial circumstances.
  • Speak to your bank, building society or insurance company. They may offer pension schemes or at least signpost to a trusted organisation.
  • Do you have any old pensions? Ask the provider if you can restart contributions.
  • Look online. If you decide to do this, make sure the company is regulated by the Financial Conduct Authority (FCA) by visiting https://register.fca.org.uk/s/ or call 0800 111 6768

 MoneyHelper Midlife Pension Review appointments

  • Telephone appointment with a MoneyHelper pension specialist.
  • Impartial guidance to help pension planning and suggest next steps.
  • Email appointments@moneyhelper.org.uk with your name, telephone number and email address to book a free appointment.

Sole Traders

You can pay into an individual plan such as a personal pension, stakeholder pension, self-invested personal pension (SIPP) or a Master Trust such as NEST.

You pay out of your income after tax but then you get tax relief on those contributions (until age 75). That means, if you pay £80 into a pension you automatically get £20 tax relief added to it and £100 is invested for you. If you are a higher rate tax payer, you can claim back the other 20% through self-assessment making your net contribution £60 in this example.

There are limits to paying contributions to pension schemes tax efficiently.

Business owners

If you run your own business, you have the option to make both personal contributions and employer contributions depending on the nature and level of income from the business. A company contribution is a business expense and would normally be allowed as a deduction against trading profits for Corporation Tax purposes. Speak to your tax/financial adviser to see whether it’s appropriate to make contributions on this basis.

Employer responsibilities

If you employ any staff, you must follow Automatic Enrolment regulations. These apply to all UK employers and state that you must either automatically enrol workers or allow individuals to join workplace pension schemes that meet minimum standards.

For further information on Automatic Enrolment please see our website and The Pensions Regulator website https://www.thepensionsregulator.gov.uk/en/employers

National Insurance and State Pension

You need at least 35 years of ‘qualifying’ National Insurance contributions to receive the full New State Pension of £9,627 a year (2022/2023). You need at least 10 years of qualifying National Insurance contributions to be eligible to claim any New State Pension. If you don’t have a full National Insurance record, you may be able to pay voluntary contributions to increase your pension.

Get a State Pension forecast online at https://www.gov.uk/check-state-pension  or call the Future Pension Centre: 0800 731 0175. Check your State Pension age here https://www.gov.uk/state-pension-age