The £2880/3600 SIPP for a retired person on low income, ideally very low or nil fee?

justcheckin

I am trying to help my parents sort their affairs and aware time is ticking for this tax year. I know there is a long-running thread on this but am too overwhelmed to delve.

Does anyone happen to know which is the absolute cheapest SIPP provider to open, put 2880 in cash, wait for tax relief, draw all monies out again, repeat the following tax year?

Many thanks

SonOf

You wont get nil fee as no business is going to do it for free.  
Does anyone happen to know which is the absolute cheapest SIPP provider to open, put 2880 in cash, wait for tax relief, draw all monies out again, repeat the following tax year?
Probably a stakeholder pension.

xylophone

You wont get nil fee as no business is going to do it for free.  

The parents could use Hargreaves Lansdown for this arrangement and pay nothing?

Open SIPP, no fee.

Contribute, no fee.

Hold in cash, no fee.

Wait for tax relief.

Arrange with HL to take PCLS and the balance as income - no fee.

No closure /early closure fee.

They would have to opt for any statement to be paperless.

Dazed_and_C0nfused

You could check Hargreaves Lansdown.

There is no fee for opening the SIPP or holding money in cash.  They pay 0.10% on cash balances within a SIPP.

The area you will need to check is fees for drawdown and if what you are doing would count as an account closure.

drphila

You're probably too late for this tax year.

For next tax year, pay in 2880 with HL before 5/1/21

Get tax relief by 21/2/21.

ASAP after 21/2/21 set up regular £25 monthly payment starting 7/4/21 (the 7th is the day that HL takes payment)

Withdraw 3599 (technically HL can close your account if the balance drops below 1000 - setting up a regular payment prevents that)

Cancel regular payment ASAP after 7/12/21

Pay in 2880 minus sum of regular payments before 5/1/22.

Repeat above.

NO FEES

Thrugelmir

drphila said:

You're probably too late for this tax year.

For next tax year, pay in 2880 with HL before 5/1/21

Get tax relief by 21/2/21.

ASAP after 21/2/21 set up regular £25 monthly payment starting 7/4/21 (the 7th is the day that HL takes payment)

Withdraw 3599 (technically HL can close your account if the balance drops below 1000 - setting up a regular payment prevents that)

Cancel regular payment ASAP after 7/12/21

Pay in 2880 minus sum of regular payments before 5/1/22.

Repeat above.

NO FEES

How long before HL bolt the door if there's a noticable increase in such activity. 

Mnd

Why is it too late for this tax year. It won't take a month to open will it? The tax relief might be after April 6th but it will still be there.
HL allow me to reduce my balance to a tiny sum(£5 from memory) to allow continuous dd payment. Only £25 a month then I pay the difference in 1 go.
They don't charge for drawdown cash either 

Audaxer

justcheckin said:

I am trying to help my parents sort their affairs and aware time is ticking for this tax year. I know there is a long-running thread on this but am too overwhelmed to delve.

Does anyone happen to know which is the absolute cheapest SIPP provider to open, put 2880 in cash, wait for tax relief, draw all monies out again, repeat the following tax year?

Many thanks

They can do it with HL free of any charges. They just need to leave a balance of £1,000 in the SIPP so it doesn't get closed. So the first year, they can only take out £2,600. Thereafter they can take out the whole £3,600 each year and providing they are well within their personal tax allowance for any other income they receive, it will all be free of tax.

drumtochty

Audaxter. I think you are out of date the £1,000 minimum in the account no longer applies.

It is up to the original poster to check that.

xylophone

What does it matter if the SIPP is closed? There is no charge for this and you can simply open a new one in the following year?

Audaxer

drumtochty said:

Audaxter. I think you are out of date the £1,000 minimum in the account no longer applies.

It is up to the original poster to check that.

I had heard there was no exit fee now, but I had thought you still had to leave £1,000 in to keep it open. Can you now take the balance down to Nil and they will leave the SIPP open?