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Making Contributions


SIPP - Making contributions

Everything you need to know about SIPP contribution limits and rules.

How much can I pay into a SIPP?

SIPP Annual Allowance: What you need to know

You can pay up to 100% of your annual earnings into your SIPP each tax year, with a maximum SIPP contribution of £40,000. Pension tax relief is given at a rate of 20% (higher rate taxpayers can claim higher levels of tax relief via self-assessment).

Your employer can make contributions to your SIPP, as well as or instead of a workplace pension. These contributions count towards your annual allowance, but are not limited by your income. 

If you do not have any earnings in the tax year, you can still contribute up to £2,880 into your SIPP.  If you have begun to drawdown income from your SIPP, you can contribute up to £4,000 per tax year.

What happens if I have an income of more than £150,000?

Individuals with high incomes may have a tapered annual allowance. You are counted as a high income individual if you have a "threshold income" of more than £110,000 for the tax year, or an "adjusted income" of more than £150,000. Your threshold income is your annual income before tax, less any personal pension contributions and ignoring any employer contribution. If your threshold income is more than £110,000, you will need to check your adjusted income. 

Your adjusted income is worked out by taking all income that you are taxed on - including dividends, savings interest and rental income, before tax - plus the value of your own and any employer pension contributions. 

Your annual allowance will reduce by £1 for every £2 that your "adjusted income" exceeds £150,000. The maximum reduction is £30,000 which reduces the annual allowance to £10,000 but only once your adjusted income reaches £210,000. 

Carry Forward

You may be allowed to exceed your annual allowance of £40,000 and still receive tax relief if you have not used your full SIPP allowance in any of the past three years. To carry forward, you must have:

  • Been a member of a pension scheme in each tax year from which you carry forward.
  • Used your full annual allowance in the current tax year.
  • Contributed less than £40,000 in one or more of the last three tax years (including personal and employer contributions).
  • Earned at least the amount you are contributing in that tax year, if you are making personal SIPP contributions.

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SIPP minimum contribution amount

There is no minimum contribution for your SIPP. You can easily make contributions via your online account using your debit card. To make a personal contribution via bank transfer or arrange contributions from your employer or another person, simply complete an ii SIPP contribution form. Any unused allowance may be carried forward for up to three years, if other conditions are met.

Can I contribute to a pension if I am not earning?

If you do not have any earnings in the tax year, you can still make SIPP contributions of up to £2,880 and receive tax relief of up to £720, giving you a total of £3,600. If you have begun to drawdown income from your SIPP, you can contribute up to £4,000 per tax year.

Can my employer contribute to my SIPP?

Your employer can contribute to your SIPP, alongside or instead of a workplace pension. Contributions can be made regularly, or as a lump sum. If your employer pays a chunk of your salary directly into your SIPP, you may benefit, as you will not have to pay National Insurance on that sum. Employer contributions count towards your annual allowance but are not limited by your earnings. To arrange contributions from your employer, simply complete an ii SIPP contribution form.

Can I contribute more than my allowance?

If you contribute more than your allowance, you will not receive any tax relief, and may also be subject to an annual allowance charge, which will be added to the rest of your taxable income for the tax year. The only time you can contribute more than your SIPP contribution limit is if you qualify for "carry forward".

Can I still pay into a SIPP if I have already accessed my pension?

If you have accessed your SIPP and taken your tax-free lump sum, you are still able to pay in up to £4,000 per tax year. Alternatively, if you have retired but not yet begun to take an income from your pension, you can contribute up to £2,880 per tax year. All SIPP contributions will be tested against your lifetime allowance.

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The ii SIPP is aimed at clients who have sufficient knowledge and experience of investing to make their own investment decisions and want to actively manage their investments. A SIPP is not suitable for every investor. Other types of pensions may be more appropriate. The value of investments made within a SIPP can fall as well as rise and you may end up with a fund at retirement that’s worth less than you invested. You can normally only access the money from age 55 (age 57 from 2028). Prior to making any decision about the suitability of a SIPP, or transferring any existing pension plan(s) into a SIPP we recommend that you seek the advice of a suitably qualified financial adviser. Please note the tax treatment of these products depends on the individual circumstances of each customer and may be subject to change in future.