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4 Responses

  1. This very clear post is now out of date and, thanks to George Osborne’s walloping of investors in the summer 2015 UK budget, becoming incorrect.

    There are now two additional allowances in the tax code: £1k per year of interest and £5k per year of dividends. Dividend taxes are now higher above that limit.

    The lifetime limit for SIPPs has fallen to £1m but is now inflation linked.

    Moreover, Osborne is consulting on major changes to pension tax relief. It takes a credulous investor to believe SIPP tax breaks remain unchanged in 10+ years time. ISA tax breaks look more likely to stay however.

    • Mike Rawson Mike Rawson says:

      Thanks for the comments. I’ve updated the post to reflect your points.

      SIPPs still beat ISAs for the time being, though I agree with you that the future looks very uncertain.

  1. March 13, 2015

    […] are the most efficient vehicle for long-term saving (see here) but this depends on tax relief up-front and the tax-free lump sum. Removing reliefs and increasing […]

  2. March 23, 2015

    […] In the UK, saving in a SIPP for 40 years could easily produce returns more than 50% higher than saving in a ISA, with an even bigger advantage over a taxable account. See here for more on SIPPs vs ISAs. […]

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by Mike Rawson time to read: 4 min