standard life or hagreaves landsdown sipp

dunstonh

Selestia have just launched regular contributions. Minimum £300pm or £3600 a year (gross) in monthly or annual payments. I think that tells you the sort of client that they are typically dealing with.

Paul_Varjak

whambamboo wrote:

Are there any SIPPs that do rebate fund commission

According to Hargreaves Landsdown, rebate on the AMC is not allowed under tax regulations. Rebate of initial charge is allowable and a lot of funds avalable in a Hargreaves Landsdown SIPP do give full rebate on the initial charge.

whambamboo

dunstonh wrote:

Selestia have just launched regular contributions. Minimum £300pm or £3600 a year (gross) in monthly or annual payments. I think that tells you the sort of client that they are typically dealing with.

What's that?

I've heard 15% of salary mentioned as a good level for contributions. That's only £24k gross income. Doesn't seem like much.

whambamboo

Paul_Varjak wrote:

According to Hargreaves Landsdown, rebate on the AMC is not allowed under tax regulations.

So how can dunstonh do it?

I presume this is purely a problem with HL's setup.

dunstonh

I've heard 15% of salary mentioned as a good level for contributions. That's only £24k gross income. Doesn't seem like much.

£300pm minimum is very high. Stakeholders are £20 and personal pensions tend to be £100. They clearly only want those making decent contributions.

So how can dunstonh do it?

I presume this is purely a problem with HL's setup.

I can do it because the product allows it. The process works by the full AMC being charged as per normal. Then the trail commission being rebated in full against that AMC. The adviser then chooses the trail they want to take (if any).

Its possible that Selestia can do this because it is a personal pension and not a SIPP. AFAIA, this is the first personal pension to invest into unit trust funds and not pension/insured funds. The difference in rules between SIPPs and PPPs is just guess but Selestia allow this rebating to occur on all their products (ISA, UT/OEIC, Onshore bond, offshore bond and pension). All the products go into unit trust funds as well and not insured versions.

Wish for 2007, close pension/insured funds and have just unit trust funds. So much easier and it would have to save money.

whambamboo

dunstonh wrote:

Wish for 2007, close pension/insured funds and have just unit trust funds. So much easier and it would have to save money.

I thought you said pensions were lower cost because they make it cheaper to buy pension funds:

dunstonh wrote:

Identical charges if unit trust based and lower if in pension funds, such as stakeholder or internal insurance company funds. So, that favours the pension again.

Are they actually not worth buying then?

EdInvestor

Usually equity funds in pensions are very second rate and trackers are certainly best outside pensions. Pensions score with commercial property funds, most of which are run by insurers themselves and not available out side the pension or life bond wrappers. There are also some reasonable bond funds offered in pensions.

scouser_in_exile

Post Edited

jamesd

scouser_in_exile wrote:

Sorry to be pedantic, but Selestia do not allow this for all products. ISAs and PEPs don't fall into this. The revenue have very strict guidelines about rebating trail in these wrappers (hence the min nominated trail you can currently take with an ISA or PEP with Selestia is 0.6%)

Sounds like a reason for an IFA to cross-subsidise the pension portion of a mixed portfolio from the ISA side. Or at least for a customer to ask for that.

Is the 300 per DD or for all products combined? Thinking of ISA from employee, pension from employee, pension from employer and pension from contracting out in 4 different payments, at least two of which may not be done via DD (employer monthly and contracting out annual pensions).

dunstonh

Sorry to be pedantic, but Selestia do not allow this for all products. ISAs and PEPs don't fall into this. The revenue have very strict guidelines about rebating trail in these wrappers (hence the min nominated trail you can currently take with an ISA or PEP with Selestia is 0.6%)

I didnt know that. Thank you.

So, in this strange world, it appears HL will discount on ISAs and PEPs but not Pensions but Selestia can discount on pensions but not ISAs and PEPs.

I thought you said pensions were lower cost because they make it cheaper to buy pension funds

If there was just one fund type available for the different tax wrappers, the costs should come down a bit and that would benefit all. However, the real benefit would be on having just one "invesco perpetual income" fund and not dozens of copies all with differing performance using the same name.