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What is a family SIPP?

by admin on December 23, 2009

It is a self invested personal pension established as a separate trust with its own Trust Deed and Rules, which is separately registered with HM Revenue & Customs. This allows groups of individuals, such as family members or business partners, to pool their pension arrangements into one scheme and enables additional flexibility   for retirement planning, including the option of  Scheme Pension.

You can have a Family SIPP if you are employed, self-employed, a pensioner, a carer, in full-time education or unemployed. A Family SIPP can be established for a child under the age of 18 by a parent or legal guardian. Contributions over a fixed level can only be paid if you are  self-employed or employed and have relevant earnings.

The scheme is established as a Trust. There is no limit to the number of members who can join a scheme and each member can choose whether to be appointed as a Trustee along with the Professional Trustee company (members below the age of 18 cannot be appointed as Trustees). The members have their own separately designated fund within the scheme but can join together to hold investments on a pooled basis.

Each member’s share of the fund can receive contributions from individuals or employers and transfers from other pension arrangements, to accumulate a retirement benefits fund from which benefits can be drawn.

For whom is the Family SIPP suitable?

  • Family SIPPS combine all the tax reliefs available to pension schemes with control, flexibility and low costs. Those for whom it may be particularly suitable are:
  • Families or groups of business partners who wish to pool their retirementarrangements for a common investment approach.
  • Those who want access to the most flexible range of
    retirement and death benefit options possible.
  • People approaching age 75 or in poor health who wish to consider the option of Scheme Pension.
  • People with family businesses who are interested in using pension assets to help with acquiring business premises.
  • People with pension money in traditional types of scheme who want to transfer funds into an arrangement with more control and flexibility.