RE: I10 Apr 2019 20:24
Curious
If you have a Sipp pension, i got couple, HL is one easy to open if got isa with them. Depends if 20 or 40% taxpayer? If 40% then a £10k investment costs £6k ( so £4k free shares) Although 20% added after couple weeks or so and extra 20% via tax return. Great way to save tax and get freebies. Even at basic rate tax put £10k in and £2k extra gets put in :) then buy £2k free shares.
SIPPs are completely different in this respect, as you’ll be responsible for making all of the decisions yourself. As such, it is highly advisable that you have a firm grasp of the investment space.
In terms of the fundamentals, SIPPs operate in a similar manner to a standard personal pension pot. As such, you’ll be accustomed to tax-efficient savings that you would not get via a standard investment plan.
Although these tax benefits will vary depending on your individual circumstances, the general rule of thumb is that for everything you pay in to your SIPP, the government will pay in an additional 20% in pension tax relief.
For example, if you’re a basic-rate taxpayer and you invested £800 every month, the government would top this up to £1,000. Moreover, once your money has been invested you can earn income without having to pay dividends or capital gains tax.
In terms of how much you can invest in to a SIPP each year, this is capped at 100% of your annual salary, up to £40,000. If you’re not currently in employment, you can pay up to £2,880 in to your SIPP account and still benefit from the government top-up of 20%.
https://moneycheck.com/sipp-guide/
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