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Rowanmoor Family Pension Trust (Family SIPP)

Transfers

Members may have retirement benefits in other pension arrangements, including those already paying drawdown income or other retirement benefits. These could include employer sponsored pension schemes or personal pensions.

The assets within these arrangements could be used to fund the scheme and the following possible courses of action should be discussed with a financial adviser.

  • Transfer the value of the investments in the other arrangement(s) into the scheme, in cash form or by in specie transfer. This will increase the funds under the control of the member and available for investment. Legislation requires independent advice is taken, from a suitably qualified individual, before transferring some types of benefits. In specie transfer of assets can be a complex process involving several different parties and will usually take longer than cash transfers.
  • Assign the other arrangement(s) to become an asset of the scheme. Assets assigned to the scheme may be invested within the member’s individual pension arrangement, or one or more of the common investment funds. Assigning another arrangement to become an asset of the scheme increases the overall value of the scheme and contributions to the other arrangement may continue, unless enhanced protection or fixed protection has been claimed. This option is often taken when there are reasons why a transfer of investments is not preferable. This could include a penalty if the funds are moved, or the loss of certain rights such as guaranteed annuity rates.
  • Make the other arrangement(s) paid-up and leave the funds with the existing provider. This option may be preferred if there are severe penalties on the fund if a transfer proceeds, or if there are guaranteed annuity rates attached to the arrangement and the member does not wish it to be assigned.
  • Continue to run the other arrangement(s) alongside the new scheme. Care must be taken to ensure that the contributions, to all pension arrangements, do not exceed the annual allowance.

A member’s total pension fund will be tested against the lifetime allowance when taking benefits and again at age 75. If the lifetime allowance is exceeded, there will be an additional lifetime allowance charge unless the member has the necessary pension protection.

For more details about transferring property to a Family Pension Trust (Family SIPP) please read our SSAS and Family Pension Trust Commercial Property Guide.

This information relates to the Rowanmoor Family Pension Trust (Family SIPP). If you would like to know more details regarding the information provided on this page please send your questions via the enquiry box on the right hand side or email us. Alternatively please visit our Family Pension Trust literature library.

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