SIPP (Self-Invested Personal Pension)

A SIPP (Self-Invested Personal Pension) is a type of personal pension that lets you choose the specific investments in your pot yourself. It works like any other defined contribution pension. What you get out depends on what goes in and how the investments perform, so the value can fall as well as rise. Contributions get tax relief. Your provider claims basic rate relief of 20% and adds it to your pot, and higher or additional rate taxpayers can claim the rest through Self Assessment. You can get relief on contributions up to 100% of your earnings, within the annual allowance, which is £60,000 for most people. Unused allowance from the previous three tax years can sometimes be carried forward. You can usually access the money from 55, rising to 57 from 6 April 2028. If you are self-employed there is no employer pension and no employer contribution, so a SIPP or other personal pension is how many sole traders and company directors save for retirement. Paying in during a profitable year can also reduce your tax bill. Before opening one, check the provider is authorised by the Financial Conduct Authority and compare the charges, as SIPP fees vary widely.

Last updated 19 October 2026Relevant toSelf-employed

Figures are UK rates and change each April. Source: GOV.UK: Personal pensions