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  • FIRST POST
    • mb6000
    • By mb6000 16th May 19, 9:02 AM
    • 7Posts
    • 2Thanks
    mb6000
    SIPP Management / Transfer ISA
    • #1
    • 16th May 19, 9:02 AM
    SIPP Management / Transfer ISA 16th May 19 at 9:02 AM
    Hi - if anyone could help with this that would be great.

    *I am self-employed with no work pension, so I have to do my own, age 42, saving for retirement at 50/55

    I have a few investments in different places and wondered if I can combine it all together into one SIPP:\

    1) Vanguard ISA - currently pay in 1000 / month and buy the 80% Life Strategy Fund, current value around 30k

    2) I recently opened a ii SIPP, so I can claim the 720 / year tax credit, I pay in 1000 / month into this account. I have bought some more of the Vanguard 80% Life Strategy Fund, and one other fund that is similar, current value 7k.

    3) I have some shares in a UK company, that are held in trust somewhere else.

    Q. Should I move my Vanguard ISA investments into my SIPP? So it's all together considering I am investing in the same fund with the same amount each month? Do this mean less charges and any tax advantages?

    Q. Should I move my shares into my SIPP? Can you do this?

    Q. Are there any other tax credits I qualify for apart from the 720 / year?

    Q. Can you have more than one ISA?

    Thanks!
Page 1
    • Tarambor
    • By Tarambor 16th May 19, 1:50 PM
    • 5,064 Posts
    • 3,980 Thanks
    Tarambor
    • #2
    • 16th May 19, 1:50 PM
    • #2
    • 16th May 19, 1:50 PM
    Q. Should I move my Vanguard ISA investments into my SIPP? So it's all together considering I am investing in the same fund with the same amount each month? Do this mean less charges and any tax advantages?
    Originally posted by mb6000
    Are you likely to need the money in the future before you hit retirement age? If so then no because anything in a SIPP is inaccessible until you're 55 years old.
    • Albermarle
    • By Albermarle 16th May 19, 1:56 PM
    • 714 Posts
    • 413 Thanks
    Albermarle
    • #3
    • 16th May 19, 1:56 PM
    • #3
    • 16th May 19, 1:56 PM
    Whilst it is possible to move shares and funds from one SIPP to another , I would think that anything going into a SIPP from another source would be seen as a new contribution to the SIPP , so would have to go in as cash and you would get tax relief on that ( if you were entitled to it).
    Just my first thought and am not 100% sure .
    • mb6000
    • By mb6000 16th May 19, 7:30 PM
    • 7 Posts
    • 2 Thanks
    mb6000
    • #4
    • 16th May 19, 7:30 PM
    • #4
    • 16th May 19, 7:30 PM
    I might need it before 55, not sure, so will keep it in its own separate ISA - thanks
    • AnotherJoe
    • By AnotherJoe 16th May 19, 8:12 PM
    • 14,223 Posts
    • 16,927 Thanks
    AnotherJoe
    • #5
    • 16th May 19, 8:12 PM
    • #5
    • 16th May 19, 8:12 PM
    Hi - if anyone could help with this that would be great.

    *I am self-employed with no work pension, so I have to do my own, age 42, saving for retirement at 50/55

    I have a few investments in different places and wondered if I can combine it all together into one SIPP:\

    1) Vanguard ISA - currently pay in 1000 / month and buy the 80% Life Strategy Fund, current value around 30k

    2) I recently opened a ii SIPP, so I can claim the 720 / year tax credit, I pay in 1000 / month into this account. I have bought some more of the Vanguard 80% Life Strategy Fund, and one other fund that is similar, current value 7k.
    That's confusing. If you have no earnings you can claim 720 on top of 2880. But 1000/month is considerably more than 2880. How much are you earning?
    3) I have some shares in a UK company, that are held in trust somewhere else.

    Q. Should I move my Vanguard ISA investments into my SIPP? So it's all together considering I am investing in the same fund with the same amount each month? Do this mean less charges and any tax advantages?
    You can't just arbitrarily pay money into a SIPP. The fact it comes from an ISA doesn't matter. You need to have sufficient earnings.

    Q. Should I move my shares into my SIPP? Can you do this?
    Yes, again depending on your earnings, plus in your cse the SIPP rules and the trust.

    Q. Are there any other tax credits I qualify for apart from the 720 / year?
    You don't appear to have understood SIPPs. You can claim "tax credits" on everything you pay iin, subject to various rules. Do you have an accountant Or IFA?

    Q. Can you have more than one ISA?
    Why would you want more than one?
    Thanks!
    Originally posted by mb6000
    I think you need to do more reading on SIPPs. Or talk to your accountant or IFA.
    Last edited by AnotherJoe; 16-05-2019 at 8:25 PM.
    Please dont criticise my spelling. It's excellent. Its my typing that's bad.
    • mb6000
    • By mb6000 16th May 19, 8:59 PM
    • 7 Posts
    • 2 Thanks
    mb6000
    • #6
    • 16th May 19, 8:59 PM
    • #6
    • 16th May 19, 8:59 PM
    Hi Joe, I should have clarified, the bulk of my earnings are not taxed (I work offshore so there are allowable expenses), so although I am a high earner and can contribute a relatively large amount each month, for tax purposes I am at the basic rate.
    • AnotherJoe
    • By AnotherJoe 16th May 19, 9:06 PM
    • 14,223 Posts
    • 16,927 Thanks
    AnotherJoe
    • #7
    • 16th May 19, 9:06 PM
    • #7
    • 16th May 19, 9:06 PM
    If you pay more than you are eligible to pay into a SIPP there will be a big tax mess.
    When you say you pay tax "at basic rate" what does that mean? You could be earning 13k or 45k. Or are you earning less than the personal tax allowance ? And if so how much ? Do you pay any Tax?
    Please dont criticise my spelling. It's excellent. Its my typing that's bad.
    • bowlhead99
    • By bowlhead99 16th May 19, 9:24 PM
    • 8,718 Posts
    • 15,951 Thanks
    bowlhead99
    • #8
    • 16th May 19, 9:24 PM
    • #8
    • 16th May 19, 9:24 PM
    Hi Joe, I should have clarified, the bulk of my earnings are not taxed (I work offshore so there are allowable expenses), so although I am a high earner and can contribute a relatively large amount each month, for tax purposes I am at the basic rate.
    Originally posted by mb6000
    The 720 a year you mentioned earlier - as a gross up for basic rate tax - implies you are contributing 2880 a year and getting it grossed up by the basic rate tax on 3600 of income a year.

    If you have 3600 or less of taxable income per year, you can contribute up to 2880 and still be given a 720 gross-up by the pension provider. You could make that 2880 contribution and get the 720 even if you didn't earn as much as 3600.

    However, if you are contributing 1000 per month (12000 a year) into the pension, you would get a 3000 gross up for basic rate tax (to make it 15000 gross inside the pension), and 720 doesn't come into it. But you would need to have qualifying earnings of 15k+, because your contribution limit is set by your earnings

    And if you are going to put more than 1000 in per month/12000 year (because for example you have existing ISA money that you also want to move into the pension on top of the 12000 a year) you are going to need to have taxable income of considerably more than 15000, and the 720 figure is definitely irrelevant.
    • mb6000
    • By mb6000 17th May 19, 8:14 AM
    • 7 Posts
    • 2 Thanks
    mb6000
    • #9
    • 17th May 19, 8:14 AM
    • #9
    • 17th May 19, 8:14 AM
    Thanks for the clarification - I think the issue here is the advice I have been given from an IFA. My situation is not that common and it's hard to find an IFA who understands. I was advised to open a SIPP in order to benefit from the 720 top up from on the small contribution.

    However, I did not realize there was a cap on what I could put into a SIPP, in regards to my taxable income, I thought you could just pay whatever you wanted to into it.

    For clarity my taxable income at the moment I think is around 27k, which is all rental property income, 20k from overseas (EU so also taxed in EU and then in UK if applicable, and 7k from the UK), makes up the total taxable income. However my earnings, which are not taxed, are considerably higher than this.

    My goals are to invest for retirement and I was told a pension was a tax efficient way to do this.

    So with this in mind is a SIPP still the way to go? And if so, how do I work out any (if any) limits to what I can contribute per year?
    • AnotherJoe
    • By AnotherJoe 17th May 19, 8:34 AM
    • 14,223 Posts
    • 16,927 Thanks
    AnotherJoe
    Your maximum contribution you can put I into a SIPP is 80% of your taxable earnings.its not clear to me from what you wrote if the full 27k is taxable in the U.K. if you put 27k on your self assesment then it will be.
    You absolutely do not want to be putting more into a SIPP than allowed for two reasons
    1. It's not legal ! You'll get money added to it which you aren't entitled to which when discovered will be a god awful mess to sort out.
    2. When you take money out of a SIPP it's taxable, unlike an ISA. So worst case you'd earn money that's not taxable pay it into a SIPP and after the tax mess is sorted get taxed at anywhere from 15% to 35% when you take it out !
    Please dont criticise my spelling. It's excellent. Its my typing that's bad.
    • jaybeetoo
    • By jaybeetoo 17th May 19, 11:30 AM
    • 812 Posts
    • 417 Thanks
    jaybeetoo
    You can usually access money from your personal pensions when you reach 55 BUT this will increase to 57 by 2028.
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