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Where Taxpayers and Advisers Meet

SIPP payment without claiming tax relief

Joined:Tue Mar 14, 2023 2:40 pm
SIPP payment without claiming tax relief

Postby hallunications » Tue Mar 14, 2023 2:56 pm

Hi. I am retired and a non tax payer with just £12K state pension as income at the moment. I believe I can only put £2880 into my Hargreaves Lansdown SIPP and obtain an extra £720 from HMRC. However, I also have £110,000 in a First Direct savings account and wish to also put that into the SIPP. Am I able to do this ? I realise of course that I would not get anything extra from HMRC. Does the £40K annual limit for payments into a SIPP just apply if you are potentially going to claim tax relief from HMRC, which I am not ?
The reason I am wishing to do this is I was hoping to use the £110.000 to take out a lifetime annuity, but I have been told that using cash in this way (I believe this is called a 'purchased life annuity') results in lower annuity rates than if I paid for the annuity from my SIPP, though the tax reatment is maybe better ? Does anyone have a view on the merits of the two ?

Joined:Sat Feb 06, 2016 2:03 pm

Re: SIPP payment without claiming tax relief

Postby JOHNRE » Mon Feb 05, 2024 12:19 pm

If you are retired and are a non-taxpayer the maximum you can currently put into a Sipp is £2880 a year which then attracts £720 in tax relief (paid directly to your pension provider). Unless things have changed over the past few years it is not possible to “carry back” and make contributions for previous years.

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