Starting a pension for my son of 14

C

Chromeo

Guest
Hi

Given that the pension situation that will face people in 50 or so years time is going to be pretty scary, I'm thinking of starting a pension for my son - probably with just a nominal amount going in that he can assume control of when he starts working. Any advice on the following:

- can a 14 year old open a pension in their own right?
- would a direct debit from my bank account to same be permissable and are their any (positive or negative) tax implications for me?
- i know loopholes such as covenants have been closed off but in terms of giving him some sort of start on this road, is there a more efficient way i could go about this?

Ta
 
A person < 18 would have great difficulty setting-up a pension.

The main reason for pension funding is the tax break.
You would get no tax relief by paying pension money to someone else's pension fund.
They also could not have any tax breakes from the pension when they do not have income (I presume that he does not!).

I think trying to start a pension for your son at 14 is just a little bit too diligent :)
Why not start a savings plan for him or increase your own pension funding?
 
Chromeo said:
Hi

Given that the pension situation that will face people in 50 or so years time is going to be pretty scary, I'm thinking of starting a pension for my son - probably with just a nominal amount going in that he can assume control of when he starts working. Any advice on the following:

- can a 14 year old open a pension in their own right?
- would a direct debit from my bank account to same be permissable and are their any (positive or negative) tax implications for me?
- i know loopholes such as covenants have been closed off but in terms of giving him some sort of start on this road, is there a more efficient way i could go about this?

Ta
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Most life companies have a minimum entry age - usually 18 years old to start a pension, be it a prsa or personal pension
 
Does he have relevant earnings in order to fund for.....if not you might be best off gifting up to the yearly threshold every yr into a Gross Roll up fund or such like product
 
Chromeo said:
Hi

Given that the pension situation that will face people in 50 or so years time is going to be pretty scary, I'm thinking of starting a pension for my son - probably with just a nominal amount going in that he can assume control of when he starts working. Any advice on the following:

- can a 14 year old open a pension in their own right?
- would a direct debit from my bank account to same be permissable and are their any (positive or negative) tax implications for me?
- i know loopholes such as covenants have been closed off but in terms of giving him some sort of start on this road, is there a more efficient way i could go about this?

Ta
Click to expand...


Could you not just just start up a fund (or funds) in trust and sign the over to him on his 18th. Don't know if you could have a privoso that they go into his pension, there by he would get tax relief when he starts working once he transfers the fund into his pension?
 
comanche said:
there by he would get tax relief when he starts working once he transfers the fund into his pension?
Click to expand...
Is this correct? Surely he cannot claim tax relief on funds that are transferred but are not from income?
 
As long as the transfer is not greater than relevant earnings (and is below the relevant income limit with their age) I don't see the issue.
 
ClubMan said:
Is this correct? Surely he cannot claim tax relief on funds that are transferred but are not from income?
Click to expand...

Am assuming that the fund is in the childs name and contributions are made to each year under the gift tax threshold.

Am no tax expert but would have thought this could work in theory. Best to consult a tax expert I suppose! :)
 
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