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Hoot_Owl
Posts: 30 Forumite
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You are absolutely fine doing this. DWP has no interest what you spend your income on - it's your money.As a non-earner, you can pay up to £3600 gross per year (£2880 net made up to £3600 by the tax relief added) into a SIPP (HMRC rules). Any assets within an approved UK registered pension scheme are fully disregarded for benefit purposes so you are correct, they are not included in any capital limits. There is no deprivation of capital, because you have no capital over £6000 to deprive yourself of - you are making pension contributions from your benefit income.2
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Just be careful of which sipp you chose, some are far better than others.0
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Just wondering if you make pension contributions while on benefits, as it stands now will this have any future impact on benefit entailment in the future. I.e won't be entailed to housing benefit or income related benefits as pension income is too great. Would it even be worth getting a pension when on long-term disability benefits?0
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williewonder said:Just wondering if you make pension contributions while on benefits, as it stands now will this have any future impact on benefit entailment in the future. I.e won't be entailed to housing benefit or income related benefits as pension income is too great. Would it even be worth getting a pension when on long-term disability benefits?Information I post is for England unless otherwise stated. Some rules may be different in other parts of UK.1
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The points made about future private pension income reducing benefits when you cash your SIPP in are important to consider. I would recommend calculating the estimated value of your SIPP at pension age and go to an online benefits calculator. Put in your future age and expected circumstances. Yes benefits can change and your SIPP value may be out but at least then you'll have an idea of the reduction in benefits due to your contributions and you can see if it's worth it.
My guess is that you would be MUCH better off doing other things with your spare cash now to realise a much better future return, however due to the grey nature of them I can't post it here.0
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