Is your SIPP client trapped by the lower GAD level?

clock

Fiona Murphy asks whether SIPP clients and advisers are restricted by a drawdown loophole

Would you transfer a client’s SIPP to another provider if they were unhappy with the service? Of course you’d consider it but what if they faced a 60% drop in income by doing so? This Catch 22 situation is proving significant for clients and IFAs. The backlash against government’s decision to lower the maximum GAD level from 120% to 100% still rages on. Recently we have seen AJ Bell urge advisers to write to their MP in a campaign to reinstate the uplift. However, a less publicised issue is the effect on SIPPs in drawdown. When a SIPP (crystallised before the reforms) in drawdown is t...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

Govt ignores pension tax lock call as petition responses top 18,500

Govt ignores pension tax lock call as petition responses top 18,500

AJ Bell started petition; Govt forced to respond after 10,000 signatures

Jenna Brown
clock 23 October 2025 • 2 min read
How SIPPs and SSASs could help power the UK's energy goals

How SIPPs and SSASs could help power the UK's energy goals

'The role of pensions in supporting renewable energy deserves further consideration'

Caitlin Southall
clock 23 October 2025 • 4 min read
IHT on pensions: A moment in time for the profession to shine

IHT on pensions: A moment in time for the profession to shine

'Bringing pensions into the IHT net marks a structural change in how wealth is transferred'

Andrew Zanelli
clock 21 October 2025 • 4 min read