April 6, 2006, saw the UK government simplify many of the rules and laws with regards to pensions, making them easier to understand, more flexible, and enabling people to invest in more than one pension at any one time. Pension reform has therefore widened the options and enabled the development of new products. For instance, there’s a big relaxation as to the way that individuals can take their money when they wish to retire. There is the opportunity to draw upon assets through annuities and to draw out pension drawdowns so they can change the amount of money they receive actually on retirement.
Self-invested personal pension schemes are tax-efficient and allow both regular and lump sum cash payments with full tax allowance and tax breaks up to the maximum level, which is 100% of the annual salary up to £245,000 a year. As an employed person, employers are allowed to pay into SIPPs and there’s a wide range of sourcing for the SIPPS, which include commercial property shares and unit trusts.