A SIPP is a self invested pension plan that provides tax advantages and allows you to invest for your retirement where and how you choose. It offers you a wide range of allowable investments, putting you in complete control, along with flexible options for your retirement income.

The SIPP itself is a ‘wrapper’ that operates within the HM Revenue & Customs (HMRC) registered pension scheme rules and is used to hold the pension fund assets. The SIPP allows you to choose where you invest your pension fund and gives you more control over how these assets could grow in the future.

Both you and your employer can contribute to a SIPP, or you can usually transfer your other pension arrangements into a SIPP, although you should take professional advice on whether this is advantageous for you. 

Benefits can normally be taken from the plan from age 50 (55 from 6 April 2010). Up until your 75^th birthday you can normally take a tax free lump sum of up to 25% of your fund (this is often referred to as a tax free pension commencement lump sum) and use the remaining value of your fund to purchase an annuity to provide you with a pension income or alternatively you can defer purchasing an annuity and instead draw an income from your pension fund while it remains invested.