EXPAT RETIREMENT PLANNINGThe International SIPP
What is an International SIPP?
Simply put, an International SIPP (or Self-Invested Personal Pension) is a UK personal pension scheme that is built for Expats.
In the UK, a SIPP (self-invested personal pension) is one of the most popular pension pots available. SIPPs are low cost, offer control over the underlying investments and allow full flexible access drawdown when the time comes.
Most UK SIPPs (AJ Bell, Hargreaves Lansdown, Vanguard etc.) no longer accept non-UK residents as policy holders. This has been exacerbated further by Brexit, given the UK is no longer part of the European Single Market.
Naturally, a market opened up for UK providers offering SIPP accounts to non-UK residents which resulted in the birth of the International SIPP.
There are dozens of International SIPP providers now in the market, each with their own features and nuances - so it’s always best to seek advice before making a decision on which to choose and transfer your UK pensions into.
Who is it for?
In theory, anyone residing outside the UK can transfer their pensions to an International SIPP account, however it will benefit some people more than others.
The main factor to consider when looking at a transfer is your existing UK pensions.
Do they allow full-flexi access drawdown as a non-resident or will they only pay out a lump sum? Do they allow you to manage the investments? Do they offer multi-currency investments?
If the answer to any of the above is no, then you should probably consider an International SIPP account.
KEY FEATURESFull flexi-access drawdown for non-residents
Complete control of investments
FCA Regulated
HMRC Approved
Ability to hold in multi-currency
Low cost and portable
LIMITATIONSTypically cannot hold individual shares
Drawdowns can take longer than UK providers
Potentially more expensive than UK providers
International SIPP Comparison
International SIPP Comparison
Our Verdict
The International SIPP remains the best solution for Expats around the world. Low-cost, flexible-drawdown and multi-currency investment options are 3 compelling reasons that should put the ISIPP at the forefront of your expat retirement planning.
CASE STUDY:
International SIPP
John, who is retired, lives in France with his wife Deborah.
His old company's Defined Benefit scheme covers their income requirements, and he will receive his UK state pension in 3 years. He has an old workplace pension with Scottish Widows valued at £325,000.
He would like to gain access and receive ongoing management of the portfolio to better align it with his needs. Specifically, he and Deborah want to travel more for the next 10 years and will require access on an ad-hoc basis. They are not concerned with large growth but want to preserve the value and generate some income.
His current pension policy does not offer flexible access and is unmanaged. As such, he can only withdraw the full amount creating an unnecessary and large tax bill. Additionally, the portfolio performed particularly badly in 2022 and whilst it has recovered a bit, still concerns him.
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We recommended John transfer to an International SIPP, specifically, the Novia Global UK SIPP. Within the SIPP he can hold a low-risk portfolio of government, sovereign, and corporate bonds as well as dividend-paying stocks such as those found in the FTSE 100
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TWG Advice Fee - £3000 (equivalent to 0.93%)
Novia Global UK SIPP - 0
Total initial cost - £3000 (equivalent to 0.93%)
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The Wealth Genesis Annual Management Fee of 0.85%, including quarterly reviews, fund rebalances, and assistance with currency conversion and withdrawals.
Novia Global UK SIPP - £216 pa
Novia Global Investment Platform including custodian - 0.34%
Total ongoing cost - 1.19% + £216 pa
