Sipps

[dog]

http://business.timesonline.co.uk/article/...1804510,00.html

Property Sipps

The Inland revenue will hate it because it will be too opaque and complicated to administer

Vested interests will hate it because it will take business away from the big pension funds

Consumer groups will hate it because of the risk of miss selling

People on modest incomes will hate it because it will keep property out of their affordability range

My money says it will be withdrawn by Chistmas.

[OnlyMe]

Also one other factor - if a large amount of money did go into SIPPS there would be another bloody great big hole in Brown's finances -> higher taxation on everybody else - that will go down well, not.

[Casual Observer]

Also one other factor - if a large amount of money did go into SIPPS there would be another bloody great big hole in Brown's finances -> higher taxation on everybody else - that will go down well, not.

I disagree with you. If people want the tax relief they will invest their income in a pension regardless of whether the pension fund is able to invest it in property. Don't forget the IR already foregoes tax` receipts on pension contributions that are invested elsewhere e.g commercial property or shares - the fact that it can now be invested in resi property makes no difference to tax receipts (apart from any new advantage e.g. tax on rental income)

Edited October 26, 2005 by Casual Observer

[OnlyMe]

I disagree with you. If people want the tax relief they will invest their income in a pension regardless of whether the pension fund is able to invest it in property. Don't forget the IR already foregoes tax` receipts on pension contributions that are invested elsewhere e.g commercial property or shares - the fact that it can now be invested in resi property makes no difference to tax receipts (apart from any new advantage e.g. tax on rental income)

COAB, I may have got the worng end of the stick but don't the proposed changes radically affect the amount of salary that can be put into a SIPP/pension in any one year?

[Casual Observer]

COAB, I may have got the worng end of the stick but don't the proposed changes radically affect the amount of salary that can be put into a SIPP/pension in any one year?

Yes they do - it will be a maximum of 1 year's salary or 215k, whichever is lower. However there will be a total cap of 1.5m in any fund, beyond which there will be swingeing penalties.

My reply was really answering the part of the new SIPPs rules that allows housing to be bought. I fully agree that the part that raises the annual contributions permitted will result in a loss of revenue to the taxman.

BTW who is COAB?

[OnlyMe]

Yes they do - it will be a maximum of 1 year's salary or 215k, whichever is lower. However there will be a total cap of 1.5m in any fund, beyond which there will be swingeing penalties.

My reply was really answering the part of the new SIPPs rules that allows housing to be bought. I fully agree that the part that raises the annual contributions permitted will result in a loss of revenue to the taxman.

BTW who is COAB?

Sorry keyboarditis CAOB.

On the face of it looks to be scope for a large drop in tax receipts in the short term if large dollops of excess salary are stuffed into SIPPS - no matter where the end investment will be.

[Casual Observer]

Sorry keyboarditis CAOB.

Ah... sorry I wasn't trying to be nit-picking. I thought you'd confused me with Crashed out and Burned, which many people shorten to COAB!!

You can call me CO!