Does cash interest earned in a SIPP count against annual contribution limits?

silvermum

This year I've kept larger than average amounts in cash in my SIPP, and with higher interest rates, it's earned about £600 in interest.
I knew I had to declare it on my tax return as it was paid gross, but I've now realised that I have no idea about the 'status' of this cash otherwise.

Does it count as part of my pension contribution for the year i.e. if I was going to contribute £10,000 can I now only contribute £9,400 (£10,000 - £600)? Or is it just an addition to my pension pot?

Seems like a silly question, but I've searched the Interactive Investor site (my SIPP platform provider) and I can't find anything about it!

silvermum

I'm assuming it's like interest earned in an ISA - and therefore does not count as 'new contribution' money this tax year?

Dazed_and_C0nfused

silvermum said:

This year I've kept larger than average amounts in cash in my SIPP, and with higher interest rates, it's earned about £600 in interest.
I knew I had to declare it on my tax return as it was paid gross, but I've now realised that I have no idea about the 'status' of this cash otherwise.

Does it count as part of my pension contribution for the year i.e. if I was going to contribute £10,000 can I now only contribute £9,400 (£10,000 - £600)? Or is it just an addition to my pension pot?

Seems like a silly question, but I've searched the Interactive Investor site (my SIPP platform provider) and I can't find anything about it!

Where have you got that idea from 🤔

It's not a contribution, it's interest earned within your SIPP. 

Mark_d

I believe that interest, dividends, capital growth in a SIPP does not affect your annual allowance

silvermum

Dazed_and_C0nfused said:

Where have you got that idea from 🤔

Haha - no idea! Think I was having a bit of a brain fog when I was reading something about cash interest being 'paid into' your SIPP!

Dazed_and_C0nfused

silvermum said:

Dazed_and_C0nfused said:

Where have you got that idea from 🤔

Haha - no idea! Think I was having a bit of a brain fog when I was reading something about cash interest being 'paid into' your SIPP!

That would be taxable (unless it was in an ISA wrapper).  And would be a pension contribution.

But you were referring to interest earned within your SIPP.

I've kept larger than average amounts in cash in my SIPP, and with higher interest rates, it's earned about £600 in interest

ColdIron

silvermum said:

I knew I had to declare it on my tax return as it was paid gross, but I've now realised that I have no idea about the 'status' of this cash otherwise.

Interest earned within a SIPP is not taxable and you should not declare it

Does it count as part of my pension contribution for the year

No