Accountants know the value of tax relief
Accountants understand pensions better than most clients, but knowing the rules and using them optimally are different things. The right structure depends on how you work: an employed accountant in industry or practice has a workplace scheme to maximise, while a sole practitioner, partner or contractor accountant needs to build their own pension efficiently — and the structure of your business matters a great deal.
Employed accountants
If you are employed, capture the full employer match first, then use salary sacrifice if offered to save income tax and National Insurance. ACAs and ACCAs in senior finance roles often earn enough to be caught by the £100,000–£125,140 personal-allowance taper, where pension contributions deliver an effective 60% relief — a powerful planning lever.
Practice owners: pay from the company
Many accountants run their own practice through a limited company. The most efficient route is usually an employer pension contribution paid directly from the company. These count as an allowable business expense (subject to the 'wholly and exclusively' test), reducing corporation tax, and they avoid National Insurance entirely — unlike salary or dividends.
| Provider | Fee (2026) | Best for |
|---|---|---|
| Vanguard SIPP | 0.15% (cap £375) | Low-cost index investing |
| AJ Bell SIPP | 0.25% | Funds plus shares, accepts employer contributions |
| Interactive Investor | £12.99/month flat | Large practice-owner pots |
| Hargreaves Lansdown | 0.45% funds | Full research and service |
Annual allowance and carry forward
- The annual allowance is £60,000 for 2026/27; employer contributions count towards it too.
- Carry forward lets you sweep up to three years' unused allowance — ideal in a strong-profit year.
- Employer contributions are not limited by your salary, only by the annual allowance and the wholly-and-exclusively test, so a director can contribute large sums even on a low salary.
- High earners should watch the taper above £260,000 adjusted income.
The optimal salary, dividend and pension mix
Accountants running their own practice through a company face a classic optimisation problem: how to split remuneration between salary, dividends and pension. A common efficient structure is a modest salary (around the National Insurance threshold to protect State Pension years and qualify for relief), dividends up to a sensible tax band, and then employer pension contributions to mop up surplus profit. Because pension contributions reduce corporation tax and avoid both income tax and National Insurance until drawn, they are usually the most efficient destination for profit you do not need to spend now. The exact balance depends on your income needs, the corporation tax rate applying to your profits, and your long-term goals.
Timing contributions and the accounting period
For corporation tax relief, an employer pension contribution must generally be paid (not just accrued) within the company's accounting period. Accountants advising themselves should diarise contributions before the year end to secure relief in the intended period, and avoid the trap of large one-off contributions that HMRC could challenge under the spreading rules. Keeping the contribution proportionate to your role and remuneration helps satisfy the wholly-and-exclusively test. With variable practice profits, combining year-end planning with carry forward gives you flexibility to make the most of strong years without wasting allowance in lean ones.
Verdict
For employed accountants, max the workplace match and use salary sacrifice. For practice owners, the standout strategy is employer pension contributions paid straight from the limited company into a SIPP — saving corporation tax and National Insurance — with Vanguard or AJ Bell as the low-cost home and Interactive Investor's flat fee best for large pots. Use carry forward to optimise lumpy profits.
Related reading: best pension for directors, employer pension contributions for limited companies, and maximise pension tax relief.