SIPPs

What is an "In-Specie" transfer and why is it importent with SIPPs?

Until recently, you could use assets you already owned as a payment into a pension scheme. In fact, advisers would often recommend a Self-Invested Personal Pension scheme, (SIPP), as a pension structure to protect assets like shares, development land or commercial premises from income or capital gains tax, which pensions have always avoided.

Imagine you had listed shares that you purchased a while ago and you wanted to make a pension contribution. Shares are an allowable asset into a SIPP and it is relatively easy to obtain a monetary value that would be accepted by both the pension administrator and Her Majesty’s Revenue and Customs, (HMRC). This would be an In-specie payment; with the asset being accepted for value in place of cash.