_ 1 Stop Independent Stakeholder Pensions Advice _ Individual Pension Account (IPA's)

Published / Last Updated on 26/10/2006

Individual Pension Account (IPA's) Stakeholder Cafe.com Quick Links:   Quotations   Compare & Buy Pensions   Get Help or Advice This is a new type of pension fund that was launched by the Government in April 2001.  There are only a very small number of  Individual Pension Accounts currently available.  They are not pension schemes in their own right but are a new special type of pension account that sits inside your pension scheme.  They are subject to the rules and benefits that attach to your pension plan.  E.g.  if you are a member of a Personal Pension Plan you can have your Individual Pension Account sitting inside the plan and it is then governed by Personal Pension Rules.  If you then subsequently leave and join an employer who offers you an Company Money Purchase Scheme - you will be allowed to transfer your IPA to the new scheme, you will then be affected by Occupational Scheme rules.  The Government does not plan to place any restrictions on which types of pension plan are able to accept these Individual Pension Accounts.  It will be the decision of pension scheme as to how they accept your IPA.  IPA's are allowed to invest in collectiveopooled investments such as unit trusts, open ended investment companies (OEIC's), and investment trusts.  For an explanation of what collective/pooled investment is and these types of investments are please click here to link to SharesAdviser.com.  There are also other special rules for IPA's such as being granted exemption from paying Stamp Duty Reserve Tax (which is currently 0.5%).  This is a special tax paid when parts of unit trusts or shares in OEIC's are sold by a fund manager and new ones purchased to replace them.  Here Are 12 Facts About IPA's From The Government: 1.  IPA stands for Individual Pension Account.  2.  IPA's are a way of saving for a pension - not pension schemes themselves.  3.  They are especially suitable for use in stakeholder pensions but can be used in all types of pension where contributions are invested to produce a fund at retirement.  4.  They work in the same way as other private pensions - you put money into the IPA, this money is invested for you, when you are older or retire your fund will be used to buy a pension for you from a pension provider.  5.  The tax rules are the same as for traditional pension investments.  6.  They can contain units and shares in pooled investment funds and Gilts (Government debt).  7.  These units and shares can usually be bought without upfront costs.  8.  You will be able to see the value of your IPA by looking up the investments in a daily paper.  9.  If you move jobs and transfer your IPA investments, your pension savings won't be hit.  10.  If you move jobs and leave your IPA investments where they are, they won't lose value as a result.  11.  IPA's are likely to be available from firms who traditionally provide pensions and others more associated with savings products such as unit trusts.  12.  IPA's were launched at the same time as stakeholder pensions in April 2001.  We will post more information to these pages when further details are released by the Government and by providers who offer Individual Pension Accounts.  If you have questions in the meantime, contact us .  Stakeholder Cafe.com Quick Links:   Quotations   Compare & Buy Pensions   Get Help or Advice

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