On 6th April 2006, the tax rules on contributions were greatly relaxed.
In any tax year, a member can contribute up to 100% of their 'relevant UK earnings' to registered pension schemes (tax approved pension schemes), for that tax year and get tax relief on those contributions.
Tax relief
Any member contribution made to The Pointon York SIPP should be made net of basic rate relief - basic rate relief is given on all SIPP contributions through what is called the 'relief at source' mechanism. We claim basic rate relief direct from HMRC on the gross contribution made and add this to the member's SIPP.
The Annual Allowance
In addition to annual earnings, restriction on tax relievable contributions for that tax year, is also subject to an upper cap on contributions / pension savings called the 'Annual Allowance'.
Employer Contributions
Employer contributions do not count towards the member's tax relievable contribution limit against earnings, although they will count towards their Annual Allowance.
'In-specie' Contributions
Contributons must normally be made in cash. However, provided a prescribed process is followed, it may be possible to pay a contribution in the form of direct assignment of asets to the SIPP (an 'in-specie' contribution).
Read our Fact Sheet for more information.