Pension contributions on sale or cessation

Produced by Tolley

The following Corporation Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Pension contributions on sale or cessation
  • Payments under s 75 of Pensions Act 1995
  • Tax treatment of s 75 payments
  • HMRC guidance

Pension contributions on sale or cessation

The payment of a pension contribution is part of the normal costs of employing staff and are deductible in the accounting period that they are paid, rather than the period in which the contributions are accrued. This is subject to the ‘spreading’ provisions which govern excessive pension contributions, as explained in the Allowable deductions for employee-related expenses guidance note.

This guidance note outlines some additional factors to take into account regarding pension contributions on cessation or sale of a business.

Payments under s 75 of Pensions Act 1995

When an employer ceases to take part in a single or multi-employer defined benefit pension scheme, that e

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