UK Sipp - Strategies for Irish Resident to access funds in retirement

[Board11]

I am 52, based in Ireland but worked in the UK for 8 years in my thirties. I have a SIPP with Hargreaves Lansdown worth ~€190k self invested in US tech shares and I pay £200 a year in fees, they screw me on the exchange rate when I trade but I tend to hold for 5+ years, so not much trading. I also have a number of Irish pensions (2 PRBs, a PRSA and Master Trust Company Pension from a former Tech employer) with a combined pot of €1.1m, and I will hit the standard rate threshold before I reach 60, and will be establishing an ARF. My question is as follows:

1. What do people do typically with their UK SIPP in my kind of circumstances, do they transfer it to Ireland at some point (the fees here look to be significant, in the order of 5%) and put it into their ARF with their other pension funds? I know this doesn't impact your pension cap calculation and is mostly done to simplify admin.
2. Does anyone have any insights into how I could leave it in the UK, and draw it down as early or as late as required. Could I drawdown some funds when I hit 55 using the 25% tax free element, and then leave the rest in the UK until I retire and access it as needed, paying into a UK bank account. I know I will pay UK tax and have to claim it back/do an Irish return, and that its all taxable.

Curious for peoples views on this.

 

[Seaniemed]

I might bump this as I am in this position except in my thirties.

I have a small SIPP and am returning to Ireland this year. I'm considering leaving it in UK to diversify as I am going to have an Irish pension drawing down at the higher tax rate (HSE SPSS).

Has anyone any thoughts or experiences on leaving it or taking it with them?

@Board11 how did you find administering the SIPP from Ireland?

 

[Board11]

@Seaniemed I am been administering my UK SIPP from Ireland for almost 20 years, its very straightforward, and the fees are a fraction of what I pay in Ireland for the equivalent (a self administered PRB from Stocktrade/Standardlife). The difference is up to 10x+ more per year in fees. My plan is to draw down 25% of my SIPP when I hit 55 and bring it back to Ireland tax free as part of my €200k tax fee allowance. I haven't decided what to do with the balance, but can't see a way to get it back tax efficiently other than drawing it as income (subject to my marginal rate) later in retirement. I think my plan is better than the alternative of paying 3 to 5% to move it to Ireland, pay higher fees and have the fund value increase contribute towards the €2m/€2.8 standard fund threshold limit, which I will hit without my UK SIPP by early 60's (It was a few years earlier before Trump unleashed his beautiful tariff plans). I would love to hear if others have any views on this.

 

[Sybilla]

I have a UK SIPP also, definitely fees much lower, wide selection of investments and easy to administer on line. It is frustrating how poor our choices are in Ireland in comparison.

I think if transferring to Ireland it would have to be to a QROP?

One point to note is that the SIPP I have only makes payments to a UK bank in Sterling (Revolut Sterling wasn’t accepted) and since Brexit some UK banks are closing accounts of EU residents. I still have an old UK account. That may not be a problem with other SIPP providers.

 

[Seaniemed]

Thanks. Have either of you used the "non-earner" allowance to contribute further to it?

I had hoped to continue to contribute to NI and SIPP this way, and aim to retire a few years earlier.

 

[Board11]

No, I have no taxable UK income since relocating to Ireland in 2006. All my pension contributions since then were in Ireland to get tax relief against my earnings. The Irish tax benefits at 40% are much higher than the additional pension admin costs of 0.75 to 2% (annual fees + transaction+ fx charges)

 

[Seaniemed]

@Board11 I am allowed to contribute £3,600 per annum as a non-tax payer - its permissible for 5 years after relocation as per HMRC. I will keep an open mind on the topic.