SIPPS Investment Pension Eligibility
Prior to April 2006, anyone under 76 years of age, and a tax resident of the United Kingdom, can, in a single tax year, contribute up to £3,600. Greater contributions are permitted, but these are dependent upon earnings.
Post April 2006 the maximum contribution upon which tax relief can be claimed is £215,000 or your earnings, whichever is the lower.
For those eligible to contribute, tax relief is available at their highest marginal rate. Contributions are paid net of basic rate tax with higher rate tax relief claimed by way of your tax return.
Net contribution £780
Tax relief at source £220
Total Gross contribution £1,000
Additional rate tax relief claimed (where applicable) £180
In addition to these increased limits, SIPPS have a number of other advantages over traditional pension schemes. These include benefits such as up to date valuations of your investments, more control, and more flexibility.
Hopefully, these pages will assist in providing basic information on SIPPS.