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Where Taxpayers and Advisers Meet

Worth me investing into a SIPP every year? Advice please

Bizman
Posts: 17
Joined: Sat Oct 21, 2017 9:18 pm

Worth me investing into a SIPP every year? Advice please

Postby Bizman » Sat Mar 10, 2018 12:27 am

I have got a large sum invested in companies as shares and receive my income exclusively as dividends.

As I am classified by HMRC as a 'non-earner' (as I don't pay income tax, but tax on my dividend earnings) I understand the maximum I can contribute is £2,880pa into a SIPP.

I'm 48 years old now. Is it worth all the hassle (and costs) of setting everything up and managing it every year for the relatively minor tax benefits I'll get for my annual £2,880 contributions. Advice welcome please.

I always max out my ISA allowance so can't shift the £2,880 there.

Thank you.

bd6759
Posts: 3076
Joined: Sat Feb 01, 2014 3:26 pm

Re: Worth me investing into a SIPP every year? Advice please

Postby bd6759 » Sat Mar 10, 2018 11:56 am

I wouldn't plan my future based on an internet forum.

Speak with an accountant and an IFA.

Bizman
Posts: 17
Joined: Sat Oct 21, 2017 9:18 pm

Re: Worth me investing into a SIPP every year? Advice please

Postby Bizman » Thu Mar 15, 2018 6:22 pm

Does anybody have any advice please? Thanks!

robbob
Posts: 2781
Joined: Wed Aug 06, 2008 4:01 pm

Re: Worth me investing into a SIPP every year? Advice please

Postby robbob » Thu Mar 15, 2018 7:36 pm

From a tax perspective if its free money (tax relief on 2880) you could set up a simple personal pension and not need the hassle of using a SIPP. Does anyone know whether this is a good idea overall return wise compared to not going down this route ? the answer has to be no, but a bit of diversification is normally a pretty sensible strategy.

Bizman
Posts: 17
Joined: Sat Oct 21, 2017 9:18 pm

Re: Worth me investing into a SIPP every year? Advice please

Postby Bizman » Sun Mar 18, 2018 8:10 pm

Thank you for the response.

Anybody got any insights into the specific amount of time it takes to do all the steps to add money into a SIPP every year and do all the related adminstration such as reporting it to HMRC, paying the SIPP provider etc.? I'm just trying to work out if it's worth me handling all the headache for just a few hundred pounds benefit per annum.

Pssst
Posts: 10
Joined: Tue Jan 19, 2016 5:28 pm

Re: Worth me investing into a SIPP every year? Advice please

Postby Pssst » Fri Mar 30, 2018 6:41 pm

Reading with interest as i too am dithering over this one except im still earning/employed

Pssst
Posts: 10
Joined: Tue Jan 19, 2016 5:28 pm

Re: Worth me investing into a SIPP every year? Advice please

Postby Pssst » Tue Jul 02, 2019 12:19 pm

Hello,, i know this discussion is a little old but could i ask a further question please without starting a new thread on the subject?

Regarding tax relief for those in the higher earnings bracket,,,,your SIPP provider claims back 20% BASIC TR on your behalf and this appears in your account eventually. What about the other 20% TR if you are in the higher earnings bracket?

Can anyone confirm if the following is correct...?

If a person is in the Higher earnings bracket then when they do their SA they input the gross amount of SIPP contributions into the relevant box on the SA form. This then has the effect of extending their 20% basic rate bracket by that gross amount and this is the means by which HMRC give you that higher rate TR on your SIPP contribution.

Correct?? Thanks all.. From a SA newbie

hendersontax
Posts: 26
Joined: Wed Jun 19, 2019 5:04 pm
Location: Manchester
Contact:

Re: Worth me investing into a SIPP every year? Advice please

Postby hendersontax » Tue Jul 02, 2019 1:27 pm

That's correct.


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