HL SIPP Fees

badger09

I have a small SIPP with HL. Already retired so max annual contribution £2880 topped up to £3600.

In the past I've left dividends uninvested to cover fees, but have obviously miscalculated.

Rather than have HL sell investments, with the accompanying charge, to pay monthly fees, is my only alternative to open a Fund and Share account & fund that with enough to cover monthly fees.

I suspect I know the answer, but would like confirmation. What I was hoping to avoid was another account closure charge should I decide to move away in future.

Alexland

Is there any reason you cannot sell some of the investments yourself? Would be cheaper than an extra account closure fee. Although maybe the FCA will eventually get around to banning the exit charge.

sjp999

Unless I'm missing something obvious, it's HL - why not pay the charges online with a debit card?

Or is the obvious thing I'm missing being that you can only do that if you have an F&S account?

badger09

Alexland wrote: »

Is there any reason you cannot sell some of the investments yourself? Would be cheaper than an extra account closure fee. Although maybe the FCA will eventually get around to banning the exit charge.

No reason I can’t sell some myself but costs are £11.95 per trade, which is slightly less than monthly platform fee. So I may as well just open a trading account simply to hold enough to pay the SIPP fees & pay the account closure fee when/if I leave.

sjp999 wrote: »

Unless I'm missing something obvious, it's HL - why not pay the charges online with a debit card?

Or is the obvious thing I'm missing being that you can only do that if you have an F&S account?

That is what I’d like to do, but I can’t see any option to pay SIPP fees that way.

sjp999

Wait until the 3rd or 4th, they open up online payments a day or 2 prior to collecting them from your available funds.

Go into an account > Account Administration > Pay fees online using a debit card should get you there.

Audaxer

badger09 wrote: »

I have a small SIPP with HL. Already retired so max annual contribution £2880 topped up to £3600.

As you are retired and putting £2,880 into a SIPP each year presumably to benefit from the tax relief, why don't you just leave it in cash until it is made up to £3,600 and then draw out £2,600 in the first year (leaving £1,000 cash in to keep the HL SIPP open)? In subsequent years with the £1,000 cash left in you can keep paying in the same £2,880 cash and drawing out £3,600 cash after the tax relief is added. You can then invest the £720 profit along with the additional £2,880 that you would have invested into the SIPP each year, into an S&S ISA instead.

There are various threads on this forum about this as it is quite a common practice and is within the rules. If retired with just a small HL SIPP, unless I'm missing something, this seems to me to be a better strategy than actually investing within the SIPP?

Alexland

sjp999 wrote: »

Wait until the 3rd or 4th, they open up online payments a day or 2 prior to collecting them from your available funds.

Go into an account > Account Administration > Pay fees online using a debit card should get you there.

Thanks never heard that before and yes it looks correct. Might help the OP for the remainder of this tax year but I will still leave a big enough cash balance in my HL LISA to avoid the monthly hassle and have less money tied up until 60. With my Halifax SIPP my preference is to collect fees from inside the account as it costs less due to tax relief.

Management fees become due when charged to your fees account. This happens within the first few days of the month. Throughout the month we shall attempt to collect any fees out of any cash balances held on your accounts.

Should there be insufficient cash on your account to cover the fee it will remain outstanding until further monies are received. If the outstanding fees continue to accrue we may contact you to ask that you settle the amount outstanding by other means. Management fees and charges can be viewed within the transaction history section of your online account, where you can also settle any outstanding fees or charges by debit card.

https://www.hl.co.uk/faqs/general/fees-and-charges/when-and-how-do-i-pay-the-fees-or-charges-due

zedsdeed

Interesting, thanks

badger09

sjp999 wrote: »

Wait until the 3rd or 4th, they open up online payments a day or 2 prior to collecting them from your available funds.

Go into an account > Account Administration > Pay fees online using a debit card should get you there.

Thank you.

I will check if this is possible for SIPP fees around 3rd or 4th. I've set an alert for HL to tell me before selling anything

Audaxer wrote: »

As you are retired and putting £2,880 into a SIPP each year presumably to benefit from the tax relief, why don't you just leave it in cash until it is made up to £3,600 and then draw out £2,600 in the first year (leaving £1,000 cash in to keep the HL SIPP open)? In subsequent years with the £1,000 cash left in you can keep paying in the same £2,880 cash and drawing out £3,600 cash after the tax relief is added. You can then invest the £720 profit along with the additional £2,880 that you would have invested into the SIPP each year, into an S&S ISA instead.

There are various threads on this forum about this as it is quite a common practice and is within the rules. If retired with just a small HL SIPP, unless I'm missing something, this seems to me to be a better strategy than actually investing within the SIPP?

Thanks, I'm aware of this. However, I'm also using my SIPP to reduce IHT.

Alexland wrote: »

Thanks never heard that before and yes it looks correct. Might help the OP for the remainder of this tax year but I will still leave a big enough cash balance in my HL LISA to avoid the monthly hassle and have less money tied up until 60. With my Halifax SIPP my preference is to collect fees from inside the account as it costs less due to tax relief.


https://www.hl.co.uk/faqs/general/fees-and-charges/when-and-how-do-i-pay-the-fees-or-charges-due

Agreed, I'll be ok next year. I've just miscalculated the amount of income I'd receive this year:o

TBC15

Why not buy a fund, buying and selling's free then.

Alice_Holt

badger09 wrote: »

Thanks, I'm aware of this. However, I'm also using my SIPP to reduce IHT.

I'm aware of the basic (post / pre 75) tax treatment, but not entirely clear what happens practically when the beneficiary receives the SIPP (in a post 75 situation).

Is it all treated as income for the beneficiary in the tax year the holder dies, or is there any way the beneficiary can phase withdraw from the SIPP over a few tax years / transfer into their SIPP?