Self Invested Personal Pension

Pension Money SIPP - Restricted Advice and a centralised Investment proposition

Typically, pensions are the most tax-efficient strategy for retirement saving. One form of pension is a self-invested personal pension (SIPP).

An SIPP enables you to create an investment portfolio tailored to your circumstances and needs in retirement, and help make sure you take advantage of all of the tax relief that this form of pension allows. However, you should note that such tax benefits are subject to change, and their value to you specifically in the future will vary depending on your personal circumstances and investment objectives. As with any other kind of investment, those held within a SIPP can drop in value, and there is a risk of this being less than your initial investment. It is important your investment objectives are reviewed on a regular basis.

The tax benefits of an SIPP include:

Zero capital gains or UK income tax

Pension investments can grow free of UK capital gains and income tax.

Unrestricted withdrawals from age 55, up to 25% tax-free

At any point from age 55 (57 from 2028), there is the option to make withdrawals, where typically up to 25% is tax-free and the remainder is taxed as income. The Pension Money SIPP provides you with the flexibility to make withdrawals as suits you – the whole fund as a lump sum; smaller lump sums; or, as a regular income. It is important to remember that a pension may need to fund your entire retirement.

Pass on your pension to your heirs tax-free

Any funds remaining in your pension when you pass away can normally be inherited by your heirs without inheritance tax applying. Usually, any withdrawals they subsequently make will be tax-free if you passed away prior to the age of 75. If you died at age 75 or older, any withdrawals they make will then be taxed as normal income.