In recent years the pensions industry has become more advanced in terms of the flexibility of investments available and the structure of the actual pension arrangements.

A Self-Invested Personal Pension (SIPP) is a tax-efficient wrapper within which a wide range of investments can be held. SIPPs have the same tax benefits and regulations as conventional personal pension plans but have control over the investment choice – each SIPP is unique to the individual. Otherwise, it operates in the same way as a conventional personal pension in respect of contributions and eligibility, for tax purposes. A SIPP must appoint a scheme administrator, usually the recognised product provider.

The complex nature of a SIPP means that it is not suitable for all investors. Often, the benefits of ‘self-investment’ are only advantageous to people with very large funds and/or investors with some level of sophistication when it comes to investment decisions. Often, there are additional charges for arranging and dealing within a SIPP and these charges would erode smaller funds quickly.