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Payments to Adult Children's Pensions
Hello I hope someone can clarify this for me please. My husband and I have 2 sons with poor pension provision and would like to make payments to their Vanguard Pensions out of income. How much are we allowed to pay to each pension? Can each of us contribute to both pensions or one each? Do we give them the money or pay into the pensions ourselves? Any help most welcome. Thank you.
Re: Payments to Adult Children's Pensions
It will just be a gift by you so the only limits are those imposed on your respective sons - principally their earnings for the year.
You should pay the monies over to them to contribute to the pension so that it is a contribution by them - there may in any case be difficulties with the pension fund administrator receiving payments from you directly as you are not their "customer".
If a son is a higher rate taxpayer, they can then claim the higher rate relief.
This does all rely on the pensions being SIPPS, it will be more complicated if they only have occupational pensions.
You should pay the monies over to them to contribute to the pension so that it is a contribution by them - there may in any case be difficulties with the pension fund administrator receiving payments from you directly as you are not their "customer".
If a son is a higher rate taxpayer, they can then claim the higher rate relief.
This does all rely on the pensions being SIPPS, it will be more complicated if they only have occupational pensions.