Tax rules and reliefs are likely to change between now and a child’s retirement, the eligibility to invest in a pension will depend on personal circumstances. The amount you might get back at 65 is only a projection, it's not guaranteed. Please remember, how your investments perform and the charges may affect the value of your investments and you may not get back the amount you invested.
Tax relief on contributions
The child’s account will receive 20% basic rate tax relief on all contributions
Potentially reduce liability to inheritance tax
Parents can use their two £3,000 annual gift allowances, which would cover the maximum annual pension contribution of £2,880 for each of two children.
They can't waste the money
As pensions generally cannot be accessed until age 55, you can be assured the money will be used to provide for the child's retirement.
Fidelity Junior SIPP must be opened by a child’s parent or guardian. The account is held in the child’s name and the child must be under the age of 18.
Once the account has been set up, grandparents and other family members can also make contributions up to the £3,600 annual limit.
Contributions to a Junior SIPP are considered personal contributions to the child. They will not affect the personal allowances of the person contributing unless they contribute more than the annual allowance or continue to contribute once the child has turned 18.
Even though the child is a non tax payer they will still receive full basic rate tax relief on personal contributions, up to £3,600 per tax year. No further tax relief can be claimed by the person contributing to the Junior SIPP.
Regular savings: £100 a month
Once we have received your application and opened your child's SIPP account, we will send you a welcome pack that explains how to manage their SIPP and make changes to their investments.
The Junior SIPP account automatically becomes the Fidelity SIPP and transfers to the child at age 18 when they can start making their own contributions. If no further contributions are made the account should be reviewed regularly to ensure that the underlying funds are performing well. If they are not any annual fund management charges may erode the value of the SIPP over the long term. We'll write to the parent/guardian and the child to confirm the changes to the account.
Our UK-based Fidelity Personal Investing Team may call you to help you with any queries you may have concerning this process.
Take a look at how much you might need when you retire with our easy-to-use retirement calculator.
We’ll then help you figure out a way to achieve that.