What is a SIPP?
Self-Invested Personal Pensions (SIPPs) are a highly tax-efficient way to save for your retirement. While traditional pensions tend to limit investment choice to specific funds, SIPPs allow you to choose your own investment and invest in areas which have long-term value, such as physical gold. If your specific SIPP doesn’t support gold investment, it’s possible to open several simultaneously for greater flexibility.
SIPPs are also subject to the same 45% tax relief as other pensions, with no capital gains tax and no UK income tax to pay, depending on your circumstances. You can start withdrawing money from an SIPP from the age of 55 onwards, and properly managed these pensions can provide a comfortable retirement arranged on your own terms, with much more freedom than other forms of pension investment.
WHY USE GOLD AS A PENSION INVESTMENT?
Investing in physical gold for your SIPP has several benefits. Income tax rebates and tax breaks mean that SIPP investment is one of the most tax-efficient forms of investment in an already tax-efficient commodity, and physical gold’s relative stability as a form of investment means that it carries less risk than the more restricted investments of more traditional pension funds.
However, your SIPP investment will work slightly differently to physical gold bought for regular investment. Your pension fund will own your gold, meaning that control of investment is more limited. SIPP funds will also have admin fees, although they’re usually fairly small.