SIPPs and Protected Rights
There are two parts to the state pension
- The Basic Pension (in 2009/10) which is £95.25 per week or £152.30 for a couple at the age of 65.
- The State Second Pension (S2P) which used to be called the State Earnings Related Pension Scheme (SERPS).
It has been possible to contract out of the S2P or SERPS for almost 20 years and to have the rebate paid into a personal pension plan where the investment is called "Protected Rights".
Protected Rights are always shown separately in a pension statement from non-Protected Rights because the rules regarding Protected Rights differ from any other type of pension. These rules are now significantly less complex and set to be removed altogether by 2012.
Until 1st October 2008 it was not possible to invest Protected Rights into a SIPP. Now you can invest your Protected Rights pension into a SIPP.
Request your free copy of Protected Rights explained.
