PENSIONS

A SIPP is a type of UK government-approved personal pension scheme that allows people to choose and manage their own investments. In 2006, the UK Treasury allowed gold bullion to form part of a personal pension. Today physical gold bars are the only physical commodity that pension owners can purchase as part of their pension.

SIPP stands for Self-Invested Personal Pension. It is a type of personal pension plan that provides individuals with the flexibility to make their own investment decisions regarding how their pension funds are managed and invested. Unlike traditional pension schemes, where investments are managed by the pension provider, a SIPP allows individuals to invest in a wide range of assets including stocks, bonds, mutual funds, and even physical commodities like gold, provided they adhere to certain regulatory guidelines.

Regulatory Approval

Since 2014, the Financial Conduct Authority (FCA) has allowed investors to hold physical gold as part of a SIPP portfolio, emphasising the choice and control it grants to investors.

  1. Tax Benefits

Investing in gold through a SIPP can provide tax advantages. The government may offer tax relief between 20% and 45% depending on the investor’s tax rate, provided the gold is in the form of bars (not coins) and is of investment grade with a minimum purity of 995 out of 1000 (99.5% pure).

  1. Investment-Grade Gold

Investment-grade gold bullion is exempt from being treated as “tangible movable property” (which would normally be “taxable” property) within SIPPs. It’s the only physical commodity benefiting from this exemption. The gold must have a purity of not less than 995 thousandths and should be held in the form of a bar or wafer of a weight acceptable by the bullion markets.

  1. Custodial Rules

The gold bullion must be held in a secure vault to the order of the SIPP provider’s trustee. It cannot be held personally by the investor, nor can it be used or displayed since it must be held for investment purposes only. There may be a custodian fee associated with holding the gold bullion in a secure vault, which also covers the cost of insurance.

These conditions ensure that the gold held within a SIPP is secured, compliant with regulatory standards, and conducive to long-term investment objectives.

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GOLD BULLION WEALTH

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