In August this year we provided an update regarding our SIPP research and due diligence on DD|hub. We are always looking to enhance the research proposition, so we are pleased to confirm we have added questions to our SIPP question set, improved the comparison table and generated additional analysis into the process. We have also conducted a SSAS review and this will soon be added to the pension services on DD|hub.
SSAS (Small Self-Administered Schemes)
SSAS predate SIPP schemes by just over 10 years. They gained popularity after A day as they gave significantly more investment options than SIPPs. In recent years the differences between the most complete SIPP offerings and SSAS Schemes have become blurred. We still feel they have a place in the advice proposition and our due diligence brings the differences between SIPP and SSAS to the fore.
SIPP (Self Invested Personal Pensions)
The term SIPP has become more of a umbrella term for pensions, encompassing traditional SIPPs or full SIPPs (where we have conducted due diligence in the past), and platform pension SIPPs, which typically have a simplified investment choice. Charges can vary between these types of products. Under Consumer Duty it can be challenging for advisers to determine and evidence the suitability of the correct product for the client. We now intend to open up DD|hub SIPPs to both types so advisers can compare and conduct due diligence on both.
SSASs vs Full SIPPs - what are the differences
The main difference between the two products:
- Loan backs to sponsoring/connected employer, which are permissible for a SSAS but not a SIPP, although all products are subject to certain conditions.
- SSAS schemes tend to be run under an individual trust with all members as trustees of the scheme, whereas SIPPs are typically run under a master trust arrangement where the member is not typically a trustee.
- SSAS investments are pooled together with investment growth proportioned between members. Historically, this was advantageous for family or partnership businesses looking at succession planning and may well still be attractive for businesses that are likely to fall under any IHT limits.
- Unlisted Shares - Although permissible in a SIPP. In practice, in recent years, providers have excluded or heavily restricted the acceptance of unlisted shares. SSAS products on the other hand due to their flexibility tend to have greater flexibility and allow these investments within schemes.
SSAS on DD|hub - What to expect
Shortly you be able to conduct your research and due diligence on DD|hub. Incorporating the data that follows our SSAS research format to compare products and the ability to apply these to specific filters to evidence research. Adviser firms will also be able to review questions on DD|hub and document their due diligence. The question set is designed to cover the majority of your due diligence requirements, but we are also happy to discuss feedback with you and the SSAS providers. If you require any further information about our product research, or DD|hub, contact our research team.
