SIPP annual allowances

Aidanmc

As i understand it the SIPP contribution allowance is 100% of income up to 60k

So for a self employed person the income figure is their taxable income which may include savings interest too?

TheSpectator

Nope, savings income not relevant earnings for pension purposes.

And the £60k annual allowance includes the basic rate relief added by the pension company.

dunstonh

As i understand it the SIPP contribution allowance is 100% of income up to 60k

No.
SIPPs don't have a contribution allowance.     The annual allowance applies to pensions.   
The annual allowance is £60,000 and you personally cannot exceed 100% of your earnings.   However, contributions can go above your earnings (such as employer contributions) and there is the option of carry forward that will be available to those earning more than £60k (but also available to some earning less than £60k)

So for a self employed person the income figure is their taxable income which may include savings interest too?

No. Savings interest is not earned income.
Self employment is often misquoted by people who operate under the limited company structure.   Are you a sole trader/partnership or limited company?   (it matters as the options for limited company are different and the annual allowance/100% of salary bit is not an issue if done correctly).

ColdIron

Savings interest is never included in relevant earnings, it's neither relevant nor earnings

Are you really self employed or a director of a limited company? There are differences

Aidanmc

ColdIron said:

Savings interest is never included in relevant earnings, it's neither relevant nor earnings

Are you really self employed or a director of a limited company? There are differences

I would be self employed - sole trader

What_time_is_it

Hijacking the thread for a minute to ask a supplementary question...!

If you are unemployed over the course of a tax year and have no earnings, what is the maximum you can put into a SIPP? And can you use previous years unused Annual Allowances?

Aidanmc

What_time_is_it said:

Hijacking the thread for a minute to ask a supplementary question...!

If you are unemployed over the course of a tax year and have no earnings, what is the maximum you can put into a SIPP? And can you use previous years unused Annual Allowances?

I believe the max is £3600 including the basic rate relief

I dont really understand the 3 year unused allowance rules

https://retirement.fidelity.co.uk/media/UK%20Employees/PDF/Guides/carry-forward-factsheet-pensions.pdf

Dazed_and_C0nfused

What_time_is_it said:

Hijacking the thread for a minute to ask a supplementary question...!

If you are unemployed over the course of a tax year and have no earnings, what is the maximum you can put into a SIPP? And can you use previous years unused Annual Allowances?

£3,600 gross (£2,880 from you plus £720 in basic rate relief).

And no, unused annual allowance cannot be used in that situation.

SacredStephan

What_time_is_it said:

If you are unemployed over the course of a tax year and have no earnings, what is the maximum you can put into a SIPP? 

If your earnings from employment or self-employment or both are under £3600 in a tax year, then you can contribute a maximum £2880 net (£3600 gross) to a SIPP in the same tax year.

What_time_is_it

Thanks everyone.
I'm taking redundancy at the end of December and I won't be working in the 2025/26 tax year so it looks like the maximum I can put in a SIPP would be £2,880 then.
Would you advise that I set up a SIPP during this tax year (i.e. before end of March 2025) in order to use up previous years "unused" annual allowance?

Dazed_and_C0nfused

What_time_is_it said:

Thanks everyone.
I'm taking redundancy at the end of December and I won't be working in the 2025/26 tax year so it looks like the maximum I can put in a SIPP would be £2,880 then.
Would you advise that I set up a SIPP during this tax year (i.e. before end of March 2025) in order to use up previous years "unused" annual allowance?

How much do you expect to earn in the current tax year?

Are you in a defined benefit scheme?