Sovereign has developed a Self-invested Personal Pension (SIPP) that is only open to members who are currently tax resident in the Isle of Man or were previously tax resident in the Isle of Man. In addition to offering increased investment flexibility, the SIPP Specialists (IOM) Scheme can provide significant tax benefits and estate planning advantages for Isle of Man residents with substantial UK and / or Isle of Man pension funds.

For Isle of Man SIPPs, there is no requirement to purchase an annuity allowing funds to continue to be invested for long-term growth. The residual fund is available for passing to your nominated beneficiaries on death and Isle of Man pension scheme assets are subject only to Isle of Man resident taxation.

Isle of Man-approved pension schemes can receive a tax-free transfer of UK benefits ahead of retirement after formal notification to HMRC that the scheme meets the criteria to be a QROPS and confirmation of such notification has been received.

Isle of Man SIPP – Key Information

Isle of Man SIPP – Key Information

Investment Options Open architecture
Benefit commencement 55 to 75 years of age
Maximum Lump Sum 30%
Guernsey tax rate applicable to pension 20%
Death Benefits Lump sum or survivor’s pension

If a member has commenced income drawdown prior to death, this will result in a 7.5% death tax charge being applied prior to any benefits being paid out to dependents.

* Isle of Man tax will not apply where the pension taxing rights are granted to the member’s country of residence under the terms of a double taxation agreement.

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