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Types of Account

Self Invested Personal Pension (SIPP)

What is a SIPP?

The TD Waterhouse SIPP (Self Invested Personal Pension) offers all the tax advantages of a personal pension scheme but with the added benefit of substantially greater flexibility. You control the pension instead of the company managing the pension scheme, which means you choose where, how and when to invest your savings for retirement.

The range of permitted investment options gives you the flexibility to vary the structure, diversification and risk profile of your portfolio to suit your circumstances.

Please note that the tax treatment of these products depends on the individual circumstances of each customer and may be subject to change in future.

What can I invest in?

The TD Waterhouse SIPP already allows you to choose from a wide range of investment types:

• Cash deposits
• UK Equities (including AIM)
• International Equities
• Gilts and Bonds
• Investment Trusts, Unit Trusts, OEICs & Exchange Traded Funds
• REITs
• Warrants and Covered Warrants

Who is it for?

There are no limitations on the number or type of pension plans you can contribute to. So, for example you may have a SIPP even if you are in an occupational scheme.

You will receive tax relief on yearly contributions up to:

• £3,600 gross if you are a Relevant UK Individual* (even if you have no earnings) or
• 100% of your UK earnings, whichever is greater.

* In general terms, you are a ‘Relevant UK Individual’ if you are a UK resident or your earnings are subject to UK income tax.

The annual allowance
From 6th April 2006 an annual allowance applies to all contributions that you or any third party (including an employer) makes. This will be £215,000 in the tax year 2006/2007. Contributions above annual allowance subject to an annual allowance charge. The annual allowance rises each year. Known rises are as follows:

After 2010/11 the annual allowance may rise by order of the Treasury.

Lifetime allowance
The lifetime allowance is the maximum amount of pension savings that can benefit from tax relief. It applies to the total pension savings from all of an individual's registered pension schemes. The lifetime allowance will be set at £1.5 million for the tax year 2006/2007, rising in stages to £1.8 million by 2010/2011.

After 2010/11 the annual allowance may rise by order of the Treasury.

What does it cost?

• No initial set up fee (normally £80)
• Low administration charge – 0.25% of the SIPP value charged twice per year (min £40, max £100 per collection). Annualised this equates to a minimum of £80, maximum £200.
• Dealing commission rates from £9.95
• Find out more about our rates and charges

Who provides the TD Waterhouse SIPP?

The TD Waterhouse SIPP is provided by TD Waterhouse and Capita SIP Services (a division of Capita Life & Pensions Regulated Services Limited). Capita SIP Services is a leading specialist pensions administrator and it is responsible for the administration of your SIPP, acting as a Trustee for the plan. TD Waterhouse provides you with the safe custody and trading facilities.

What are the other benefits?

• Easy to set up
• Multi-currency facility - hold cash in four major global currencies (GBP, USD, CAD and Euro)
• Competitive interest earned on cash
• Online or phone access
• Real time price quotes
• Price Improvement »More information
• Limit orders
• Hemscott^TM research
• Nominee Facilities »More information
• Account confirmation messages by email or post

How do I fund a SIPP?

Contributions – you (and your employer, if they want to) can invest into a SIPP.

Contributions can be:

• One-off and/or regular
• Paid personally by you, or
• Paid by your employer up to your permitted maximum allowance.

If both you and your employer contribute, the combined total must be within the maximum as shown above.

Transfer from another plan – if you have accumulated pension benefits in another arrangement, you can often transfer them into the SIPP consolidating your investments into one plan. You should take professional advice on whether this is advantageous for you (advice is mandatory if you are considering transferring a final salary scheme).

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