SIPP Costs and Charges

The charges levied on a SIPP (self invested personal pension) can be quite substantial, although they do vary from provider to provider (and also on the size of the investment) , so it's worth shopping around before committing to a plan. Some of the typical charges include:

Set Up Charge

The initial fees charged for setting up a SIPP can vary from free to £750, although typical charges tend to be around the £300 mark.

Annual Administration Fee

These yearly charges are designed to cover annual administration costs, and can range from free to £1,000 every year, although they are more normally in the £400-600 range. Some providers may charge based on the value of your fund (e.g. 0.5-1%).

Transfer-In Charge

This fee may be charged if you are moving funds from any of your pension schemes into your SIPP; it can range from free to £300.

Exit Charge

If you decide to transfer your SIPP elsewhere, your provider may charge up to £1,300 to do so.

Property Purchase Charges

If you buy a commercial property, the pension trustees will usually charge between £450 and £650 for their services. These fees are in addition to the usual costs involved in buying property (e.g. solicitor's fees, surveyors fee', stamp duty and searches), all of which will have to be paid by the SIPP.

Dealing Charges

Every time your SIPP provider buys or sells investments (other than property) within a SIPP they may make a charge, typically costing from free to £60 (or more) per transaction.

Advice Costs

The expertise and time given by an investment adviser will normally cost you between 0.5% and 1% of the value of your pension fund per annum.

Benefit Costs

Charges are usually made when taking benefits from your SIPP; for example, you may be charged £300 a year for taking an alternatively secured pension (ASP), £200 a year for an unsecured pension (income drawdown) and £100 for the costs involved with purchasing an annuity.