A SIPP could be right for you if you
- are looking to build up a pension fund in a tax-efficient way
- understand that growth is not guaranteed
- are prepared to commit to having your money tied up, normally until at least age 55 and
- require access to wider investment opportunities, such as investment in a portfolio of listed stocks and shares.
It may not be suitable if you
- want unrestricted access to your money, or
- are only likely to require access to a more limited range of fund management type investments, such as those available under insurance company personal pension or stakeholder pension plans, or wish to invest directly into assets, such as commercial property, that are not available through our SIPP.
If you have any doubts about the suitability of our SIPP you should contact a suitably qualified financial adviser.
You can have a SIPP if you are resident in the UK. If you are resident overseas you can set up a SIPP for the purposes of transferring benefits from a UK registered pension scheme.
No, a SIPP isn’t a stakeholder pension. Stakeholder pensions are relatively simple pension plans, with limited investment options, for which the Government has set minimum standards to be met by providers covering areas such as charges, minimum payment levels and terms and conditions.
Stakeholder pensions are widely available and may meet your needs at least as well as a SIPP. If you are in any doubt about the suitability of a SIPP you should contact a suitably qualified financial adviser.
Yes you can. For tax relief purposes, you will need to take care not to contribute more than your personal contribution limit and the annual allowance.
You can only apply for our SIPP online.
No. A SIPP must be held in a single name.
Yes you can and the contributions still receive basic rate tax relief. Most people, including children, can normally contribute up to £3,600 to a pension – even if they have no taxable earnings. With the basic rate tax relief of 20% (for 2013/14) added by the government, the net cost is just £2,880.
The contribution will count towards your child / grandchild's limits and not your own meaning the amount you can contribute to your own SIPP will remain unaffected.
Any higher rate tax relief due will be based on the earnings of your child or grandchild and can be claimed by them, not yourself.
They will not be able to access the money in their SIPP until they are 55, meaning that they will benefit from the potential investment growth of their SIPP over the long term.
No, you can hold all or part of your funds in cash until you are ready to invest them. Any interest paid under our SIPP is paid gross.
You do not have to make any contributions to your SIPP if you are transferring from another pension scheme.
Single contributions to your SIPP must be a minimum of £1,000 gross (you pay in £800, then £200 is added in basic rate tax relief).
If you want to make a regular monthly contribution, there is currently no minimum payment.
No, not with our SIPP. You can however choose to invest in certain funds holding residential property if you wish with other AJ Bell products.
Not with our SIPP. AJ Bell does offer other SIPPs where you can invest in commercial property.
No. Once invested in a pension you cannot withdraw those funds until your 55th birthday. You will normally be able to take up to 25% of the fund as a tax free lump sum and use the remainder to provide a retirement income which will be subject to tax.
There are 3 ways that you can do this – through a drawdown pension, flexible drawdown or a lifetime annuity.
Yes. A SIPP gives you the flexibility to choose and change your investments when you want. With our SIPP you can do this online for most investments.
To buy or sell the investments in your SIPP, you need to securely login to your account. Once logged in, from your ‘my accounts’ page, select ‘Deal’ and this will take you to our dealing facility where you can choose to buy or sell any of the investments within your SIPP portfolio.
Alternatively you can buy or sell your investments over the phone by calling Dealing Services on 0845 373 3479.
The online dealing charge is determined by the number of deals you placed in the previous calendar month across your SIPP, ISA and Dealing Account (excluding any regular investment deals).
We charge £4.95 per online deal to either buy or sell investments when 10 deals or more were placed in the previous month and £9.95 per online deal when less than 10 deals were placed. For example, the dealing charge you pay in December will depend on the number of deals you made in November.
Telephone dealing is £29.95 per deal.
See all the charges and rates associated with our SIPP.
Please note that Stamp duty of 0.5% applies on all purchases (not sales) of UK quoted shares (1% for shares quoted on the Irish Stock Exchange). Stamp duty is payable on certain securities issued by UK incorporated companies where these securities are traded as CREST Depositary Interests. There is no stamp duty on purchases (or sales) of unit trusts, open ended investment companies (OEICs), exchange traded funds (ETFs), warrants and government stock.
The current rates of interest paid can be seen using this link.
There are various ways that you can pay money into your SIPP. You can use
- debit card
- Direct Debit
To pay money in, you need to login to your SIPP account and from your ‘My accounts’ page, select ‘Manage my account’ and then use the payment method of your choice.
Dealing charges will be included in the contract total when you make a deal. To place a deal, you must have enough “available cash” in your SIPP to cover all the costs associated with that deal.
Equity deals are processed immediately. Unit trust and OEIC deals are processed daily depending on the dealing cut off time for the fund (this varies from fund to fund). Orders received after the dealing cut off time will be executed at the next valuation dealing point, which is usually the following business day.
You can reinvest proceeds of equity sales immediately after they have been processed; proceeds of unit trust and OEIC sales can be invested as soon as a contract note is confirmed on your account, this is normally the day following the sale transaction is placed. Check your ’Available cash’ for your maximum dealing limit.
We will provide you with a statement annually. We will send you a secure message informing you that your statement is available to view and download from your document store. Your document store is within the administration section of the dealing site.
Any dividends that you may receive from your investments will be paid into the cash account of your SIPP. You are then free to choose what to do with the dividend payment. You may leave in your cash account, or reinvest it.
Yes you can.
You can set up a monthly Direct Debit which means that money will be withdrawn from your bank account and paid into your SIPP cash account on the same day each month. You can then invest these monies as you wish.
To set up a Direct Debit you need to login to your SIPP dealing account, select ‘Manage my account’ from your ‘My accounts’ page and then select ‘Make a regular payment’ and follow the online process.
Yes you can.
Our regular investment service allows you to invest every month in a wide range of
investment opportunities, including the FTSE 350, selected funds our funds universe and selected investment trusts, ETFs and ETCs.
Setting up a regular investment is simple and once we have received your instruction, we will automatically make your deals on the 10th calendar day of each month (or the next working day).
Obviously for us to make your deals, there must be sufficient money in your cash account to pay for them. If there isn’t, we won’t make your deals on that given month and will try again the next month.
You are also able to amend your regular investment instructions up until midnight on the 9th calendar day of each month (or midnight on the day before the regular investment dealing day).
You can normally transfer the following types of pension into a SIPP
- Personal Pension Plan, Stakeholder Pension Plan, Retirement Annuity Contract
- other SIPPs, FSAVC (Free Standing Additional Voluntary Contribution plan)
- EPP (Executive Pension Plan) and
- most paid up Occupational Money Purchase Plans.
The transfer normally takes 4-6 weeks to complete and is surprisingly straightforward. We do not charge for transferring a pension into your SIPP.
Yes, our SIPP can accept transfers from Free Standing AVCs (FSAVCs), most paid-up money purchase occupational schemes, and Executive Pension Plans (EPPs). We can accept transfers of other occupational schemes but may require that you take advice from a professional financial adviser.
Yes, they can contribute by Direct Debit, cheque or by bank transfer (BACS). Employer contributions are paid gross, so basic rate tax relief is not deducted from the amount they contribute.
Yes it does. If you’re looking for certain features our SIPP doesn’t offer, within the AJ Bell Group, there are a number of alternative SIPPs that may meet your needs.
AJ Bell Platinum
AJ Bell Platinum includes our fully bespoke SIPP and SSAS products. These are differentiated from other similar products by five key factors: The member is a trustee; is a signatory on the trustee bank account; as a trustee is a legal owner of all scheme assets; has a named administration team; and finally, Platinum SIPP and SSAS clients have access to our fee based consultancy service.
Sippcentre offers a low cost SIPP with significant online functionality. With Sippcentre, your SIPP is managed on your behalf by your financial adviser. Investment options include a choice of fund supermarkets, discretionary investment managers, insurance company funds, cash deposits and commercial property.
Sippdealxtra gives you all the benefits of the AJ Bell Youinvest SIPP but allows you to use your preferred stockbroker from our panel. Sippdealxtra enables you to
- buy/sell investments via your stockbroker in the usual way
- deal with your stockbroker for investment queries
- access the Pension helpline via Sippdealxtra
- transfer cash between Sippdealxtra and your stockbroker using our online cash movement facility and
- use of our illustration tools to project your pension benefits.
Please note that the charging structure for these other SIPPs is different to AJ Bell Youinvest.
The pension input period is the period of time that is used to measure the value of contributions paid to calculate if a HMRC annual allowance charge is due. This does not have to be the same as a tax year and it is possible to change the dates.
For more information on pension input periods, please telephone us on 0845 54 32 600. (lines are open 9am to 5pm, Monday to Friday.)
You can transfer out the value of your SIPP to another UK registered pension scheme, or qualifying recognised overseas pension scheme (QROPS), at any time. If you would like to transfer out then please telephone Youinvest on 0845 54 32 600.
If you have started taking benefits from your SIPP, then you must transfer the whole of that part of your fund from which you are drawing benefits to your new scheme. If you have uncrystallised funds under the SIPP (i.e. no benefits have commenced) you can choose to transfer all, or only a part of those uncrystallised funds to another pension scheme.
If the transfer is to QROPS, a check against your lifetime allowance must be carried out before the transfer payment is made. So it is possible that a lifetime allowance charge may apply.
The transfer can be in the form of a cash payment, in which case you will have to sell all of the investments held under your SIPP before the transfer is completed, or you may be able to transfer them in their existing form (known as an "in-specie transfer").
The costs associated with setting up and managing a SIPP are detailed in the charges and rates.
At any time after your 55th birthday, you can start to use the money invested in your SIPP to provide you with benefits either in the form of a lump sum and/or an income.
There are 3 ways that you can do this – through a drawdown pension, flexible drawdown or a lifetime annuity.
To help you understand your options at retirements we have developed our comprehensive benefits guide.
Before you decide on your income options, you have the opportunity to take a tax-free lump sum - also known as the "pension commencement lump sum". The value of this can be up to the lower of
- 25% of the value of the fund used to provide benefits and
- 25% of your unused lifetime allowance.
If you have protected lump sum rights, then you may be entitled to a larger tax-free lump sum.
You cannot take a tax-free lump sum and use it to increase your pension contributions because the lump sum will be treated as an ‘unauthorised payment’. You will be taxed on the payment at between 40% and 55%. Your pension fund will also be subject to a tax charge of between 15% and 40% (depending on how much of the tax charge you have already paid).
From your 55th birthday you can choose to use the money held in your SIPP to provide you with an income in a variety of ways. One of these options is to buy a lifetime annuity.
A lifetime annuity is a regular, taxable, income guaranteed to last you for life. Buying a lifetime annuity involves passing the value of your SIPP to the insurance company of your choice. The insurance company is then responsible for arranging the payment of your income and for deductions of income tax.
To compare the latest annuity rates from a number of leading providers, you may use this calculator provided by the FCA.
Or, if you would like help with the decision making process in buying an annuity then please use this tool provided by the Pension Advisory Service.
The amount you receive will depend on your age, whether you are male or female, the size of your pension fund and, in some circumstances, the state of your health.
If you buy an annuity, you will usually stop having any further involvement with the investment of your pension fund. This may be the right option if security of income is an important issue.
Income drawdown is one of the options you can choose in order to receive an income from your SIPP at any point from your 55th birthday. There are two different types of income drawdown – drawdown pension and flexible drawdown.
Drawdown pension, also known as “capped drawdown” is when your pension fund remains invested and you draw an income from the fund, up to a maximum level set by HMRC. There is no minimum level of income, so you can elect to receive a "nil" pension, if you wish.
You can choose to take a regular monthly, quarterly, half yearly or annual income. Regular payments are made on the third Monday of each month. You can also take one-off pension payments to suit your circumstances.
To get an income from your SIPP pot using a drawdown pension, you will have to complete a benefit form to tell us how much of your SIPP is to be used to provide your income and how you’d like it to be paid.
The maximum level of annual income is set at 120% of the Government Actuary's Department's (GAD) relevant annuity rate. This rate varies depending on your age and returns from Government securities and is applied to the value of your pension fund at the date the fund is first used to provide drawdown pension and at each subsequent review.
The maximum income will be recalculated every three years until you reach age 75 and annually thereafter.
You can elect to have the maximum income level reviewed at each anniversary of the date funds were first designated to provide drawdown pension. You must make the election before the relevant anniversary.
If your SIPP holds a mixture of funds that have and have not been used to provide you with benefits, you can choose to draw further benefits at any time. This will normally trigger an immediate review of the maximum income level and also a further check against the lifetime allowance.
You can choose to purchase a lifetime annuity with your drawdown pension fund at any time.
If you purchase an annuity from your drawdown pension fund before your 75th birthday a further lifetime allowance check will normally be carried out.
A further lifetime allowance check will also be carried out on your drawdown pension fund at your 75th birthday unless the drawdown pension fund commenced before 6 April 2006 and no further funds have been added to that drawdown pension fund on, or after, that date.
Before selecting drawdown pension you should read the ‘Income withdrawal from your SIPP’ section under ‘Risks’Flexible drawdown
Flexible drawdown is an option allowing you, if you meet certain conditions, to draw funds from your SIPP without any annual limits.
You have the flexibility to withdraw all of the funds from your SIPP in one go, to draw a regular income over and above the “capped drawdown” limits to suit your ongoing requirements, or simply to draw additional funds to suit one-off circumstances.
The flexible drawdown option is only available to you if you are able to meet a Minimum Income Requirement (MIR). In order to meet the MIR you must have secure retirement income of at least £20,000 per annum. Income from state pensions and lifetime annuities qualifies for the MIR, but income from drawdown pensions and non-retirement incomes does not.
Additionally, if you make a contribution to any pension scheme (or accrue benefits in a final salary scheme), you may incur significant tax charges.
You cannot use flexible drawdown if contributions have been paid to a registered pension scheme in your name in the same tax year. If you do, flexible drawdown payments may be classified as ‘unauthorised’ and be subject to unauthorised payment charges. If you make contributions once you have taken flexible drawdown, they will be subject to the annual allowance charge.
The lifetime allowance and your SIPP
The Government has set the standard lifetime allowance at £1.5 million for 2013/14. The lifetime allowance reduces to £1.25 million from 6 April 2014.
Each time new benefits commence ("crystallise"), a portion of your lifetime allowance is used up.
When you reach your 75th birthday any uncrystallised funds will also use up a portion of your lifetime allowance, as may any benefits crystallised after 5 April 2006.
Once you have used up your lifetime allowance, any benefits paid above the allowance will be subject to the lifetime allowance charge.
If excess funds are used to provide a taxable pension, the lifetime allowance charge is 25% of those funds. Alternatively if excess funds are paid as a lump sum the lifetime allowance charge is 55%. We will deduct this tax charge from your fund and pay it to HMRC before paying your benefits.
If you built up substantial pension savings before 6 April 2006 and have registered for enhanced and/or primary protection ('transitional protection') with HMRC then this may reduce, or eliminate, any lifetime allowance charge that would otherwise be payable.
Do I have to take benefits?
No. You are not forced to take lump sum or pension benefits from your SIPP at any time.
However, the tax charges applied to lump sum death benefits paid from your drawdown pension fund will also apply to the undrawn part of your fund from your 75th birthday.
Death benefits payable from your SIPP
Death benefits will normally be paid as a lump sum but may be applied to provide pension benefits for a spouse, civil partner or dependant, either under income withdrawal or by annuity purchase. Death benefits are payable at the discretion of AJ Bell Management Limited, as the Scheme Administrator, of your SIPP. You may nominate the individuals you wish to receive benefits and your wishes will be taken into account. You may complete a new nomination at any time.
Lump sums paid on death are normally free of any Inheritance Tax (IHT) but we cannot guarantee that this will be the case. Any lump sum death benefit paid from an income drawdown fund will be subject to a tax deduction of 55% (2013/14).
The benefits payable, if any, will be determined by the terms of the annuity contract.
Please read the terms and conditions of our SIPP .
Your SIPP is governed by a trust deed and rules, as amended from time to time. These are the scheme rules.
You have a legal right to cancel your SIPP, if you change your mind. If you wish to cancel you must do so within 30 days of the date you receive our letter confirming the establishment of your SIPP.
Cancellation rights will also apply to the receipt of transfer payments and on the first occasion that you choose to take income drawdown. You will have 30 days from the date that you receive our letter acknowledging the transfer or establishing the drawdown to exercise your right to cancel.
You may exercise your right to cancel by writing to us at
AJ Bell Management Limited
Fax: 0845 54 32 601
quoting your name and SIPP reference number.
You must state whether you wish to cancel your SIPP, a specific transfer or drawdown.
If you wish to make an investment during the 30 day cancellation period you can do so, but this will lapse your cancellation rights. Lapsing your rights will mean that you cannot cancel your SIPP, contributions or transfers.
Further information about your cancellation rights is included in our SIPP
terms and conditions.
Yes. The Financial Services Compensation Scheme (FSCS) has been set up to deal with compensation, if firms are unable to meet claims made against them.
For bank deposits the maximum claim that could be made by your SIPP is £85,000.
Further information about the compensation arrangements is available from the Financial Services Compensation Scheme at www.fscs.org.uk .
No. We are not authorised to provide any advice on tax or financial services related matters.
If you need any advice then you must contact a suitably qualified financial adviser. Your adviser will give you details about the cost of advice.
Our 'Can we help?' page gives you all the details of how to contact us by email, phone or post, as well as links to our frequently asked questions sections.
Customer satisfaction is very important to us and if you do have any cause to complain about the services provided there are clear procedures laid down by the Financial Conduct Authority to ensure that your complaint is dealt with fairly. Please contact us in the first instance at
|AJ Bell Management Limited
Tel: 0845 54 32 600
Fax: 0845 54 32 601
If you are not satisfied with our response, you may refer your complaint to the Pensions Ombudsman, if your complaint concerns the administration of your SIPP.
Help is also available from The Pensions Advisory Service (TPAS) who can advise you on how to complain and may be able to sort the matter out, without the need for the Ombudsman to get involved. The address for both the Pensions Ombudsman and TPAS is as follows
|11 Belgrave Road
Tel: 0845 601 2923
All other complaints may be referred to
|The Financial Ombudsman Service
South Quay Plaza
183 Marsh Wall
Tel: 0845 080 1800
Making a complaint will not affect your right to take legal proceedings.
We are part of AJ Bell, one of the largest providers of low cost, online investment platforms and stockbroker services in the UK, with assets under administration exceeding £19.3 billion and more than 78,000 clients.
AJ Bell Management Limited is authorised and regulated by the Financial Conduct Authority.
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