Matthew says here that “as a sole trader any pension contributions you make into you own pension, will effectively be treated as Drawings”
So does this mean that it’s not possible to include pension contributions to a SIPP (non employer contributions) into QuickFile without it looking like that money is an expense, or just spent? I was hoping to include the information for my accountant when he logs into QuickFile to finalise my tax return, but I’m guessing it’s probably better just to provide the SIPP contributions separately to the accountant?
I’m guessing this is also problematic when it comes to submitting tax returns directly to HMRC via QuickFile as contributions usually help to reduce my tax bill. Unless I’ve missed something? Thanks very much.
Contributions that you make out of your business bank account should be treated as drawings, but you could make a separate drawings bank account (or just a balance sheet nominal under assets & liabilities) to record such payments in-year separate from other drawings. Once your accountant has got the numbers they need you (or they) would then journal this total to the drawings nominal under capital and reserves to clear it for the next year.
But this would only capture contributions you made from your business account - if there are other contributions you made during the year from other sources then you’d have to report those to the accountant separately anyway.