SIPP Charges AJ BELL and Interactive Investor ?

clivep

Albermarle said:

With my Fidelity account. They first try and take the monthly charge from my 'cash management account' which is a separate account. They remind me each month to top it up as there is zero in it.
I do nothing and they organise a transfer from my SIPP to this account to pay the charge, so it only costs me 80% of the charge effectively.
I tried once to move the money from my SIPP myself but to do this I had to start the formal drawdown process, so cancelled it.
Apparently in the past it was not allowed to pay charges from tax relieved money, but now it seems to be.

I've had a Fidelity SIPP for many years and they have always taken the management fees from the SIPP. I've run this a/c down and now only hold a very small amount which is in cash. There are no longer any fees on this SIPP as I still have a £40 monthly contribution by direct debit.

I'm in the process of transferring my main SIPP from AJ Bell to Fidelity so will be charged fees again. It seems that the SIPP is last in line for providing the fees. The 'cash management account' which appeared some time ago has had no transactions yet will be first in line for payment of fees! Why would anyone want to pay the fees by putting cash into this a/c rather than have them taken from the SIPP? I've spoken with Fidelity and they confirm that as long as the cash management account balance is kept at zero then the fees will be collected from the SIPP.

Albermarle

The 'cash management account' which appeared some time ago has had no transactions yet will be first in line for payment of fees! Why would anyone want to pay the fees by putting cash into this a/c rather than have them taken from the SIPP?

Could be someone who has no idea about the tax situation.
The Cash Management account can also be used for ISA fees, which does make more sense.
Also it is where they pay cashback bonuses for transfers in .

FIREDreamer

Albermarle said:

segovia said:

jimjames said:

segovia said:

I also pay £21.99 flat fee to II every month to cover my account charges, I do not get tax relief on the £21.99 I pay to II.

II are cheaper than my AJ Bell and if I consolidate I'll probably stick with II, however I thought it worth a mention. It seems very strange to get tax relief on payments to cover account charges.

Not sure why it's strange to get tax relief on charges. If it's taken from inside the account then it will be from money that by its nature has been given tax relief. I'm with ii and am intended the fees to come from the SIPP so it's costing me less. Why pay 100% of the fees when you only need to pay 60% or 80%?

It's strange because I don't get tax relief on my charges with Interactive Investor

With my Fidelity account. They first try and take the monthly charge from my 'cash management account' which is a separate account. They remind me each month to top it up as there is zero in it.
I do nothing and they organise a transfer from my SIPP to this account to pay the charge, so it only costs me 80% of the charge effectively.
I tried once to move the money from my SIPP myself but to do this I had to start the formal drawdown process, so cancelled it.
Apparently in the past it was not allowed to pay charges from tax relieved money, but now it seems to be.

With Hargreaves and AJ Bell I always paid the SIPP charges from the SIPP, since opening in 2007. And I still do.

ericlered7

Hi all, sorry to resurrect this thread but I have a question to ask about my AJ Bell SIPP.

I currently have some money sat in my account as cash & want to buy funds with some of it.

On the Buy Funds page it asks if I want to include dealing & other charges on the total cost of investment, or exclude them and pay them on top of the amount invested. 

Can somebody please help with which one is best to choose? 

Ps. This is my first investment in a SIPP.

Thank you in advance!

Pat38493

segovia said:

I have two SIPPS, AJ BELL and II. 

I pay in a regular £25.00PM to AJ Bell to cover the monthly costs, account charge for shares and any other trading costs. I get tax relief on my £25.00 which is £6.25. 

I also pay £21.99 flat fee to II every month to cover my account charges, I do not get tax relief on the £21.99 I pay to II.

II are cheaper than my AJ Bell and if I consolidate I'll probably stick with II, however I thought it worth a mention. It seems very strange to get tax relief on payments to cover account charges.

You need to look at the II help pages or call them - I suspect that if you gave them a payment method for the charges on sign up, they will charge you viat that method.  However if you didn't they take the charges out of your SIPP so you do get tax relief. 

My II charges are just coming from the SIPP pot but I cannot remember how I achieved that or how I set it up.  I think there is a kind of priority order.  Obviously it's better to pay the charges out of the SIPP so you get tax relief on them.

bjorn_toby_wilde

ericlered7 said:

Hi all, sorry to resurrect this thread but I have a question to ask about my AJ Bell SIPP.

I currently have some money sat in my account as cash & want to buy funds with some of it.

On the Buy Funds page it asks if I want to include dealing & other charges on the total cost of investment, or exclude them and pay them on top of the amount invested. 

Can somebody please help with which one is best to choose? 

Ps. This is my first investment in a SIPP.

Thank you in advance!

If you’re just talking about the dealing charge it doesn’t really matter.

Let’s say you are investing £10,000 then if you exclude the dealing charge it will cost you £10,001.50 and £10k will be invested.  If you include it then £1.50 will be taken from the £10k and £9998.50 will be invested.

Keep enough cash in the account to pay the monthly fees ideally.