What is SIPP (Self-invested personal pension)?

A SIPP is a UK personal pension where you choose the specific investments yourself. Contributions get tax relief, investments grow free of UK income and capital gains tax, and money usually cannot be taken out until the normal minimum pension age. Part of a pension can usually be taken tax-free, and the rest is taxed as income.

Why SIPP (Self-invested personal pension) matters

Tax relief on the way in makes each contribution larger, but the money is locked away for decades, which is the central trade-off against an ISA.

Related terms

• Relief at source
• Pension annual allowance
• Tax-free lump sum

Lessons that use this term

• What is a SIPP? Personal pensions explained
• What is an ISA? Stocks and shares ISAs explained
• Tax-advantaged accounts explained

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