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Child SIPP

It’s natural to want to provide for your child financially.
Here’s how we can help.


Important information

Please remember the value of your investments and any income from them can go down as well as up. The value of your fund may be less than you paid in.

Before you choose a SIPP, make sure you understand its aims and risks. You should ensure you have read the Key features document beforehand.

A SIPP requires active management and investment expertise. You should make sure you review your investments regularly.

All investments carry an element of risk which may differ significantly. If you are unsure as to the suitability of any particular investment or product, you should seek professional financial advice.

Laws and tax rules may change in the future without notice. The information here is our understanding in March 2017. This information takes no account of your personal circumstances which may have an impact on tax treatment.

Related documents

Visit our dedicated Child SIPP literature page.
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Child SIPPs at a glance

  • A tax advantaged way to save for your child’s later life

  • Invest up to £3,600 this tax year (you pay £2,880 and we claim £720 tax relief for you)

  • Child gets control at 18 but can’t access their savings until later in life (late 50s)

  • No Capital Gains tax

  • No tax on income generated in the SIPP

IMPORTANT! Read the SIPP Key Facts and our Charges Guide for all the details and before you make up your mind if our Child SIPP Account is right for you. You might also want to read our pensions section.

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Why ATS for your Child SIPP?

  • Save regularly from £50 a month

  • Stop, start and change your payments whenever you like

  • 24/7 access to manage your Child's SIPP online

  • Over 4,000 investments to choose from

  • Account fees that don’t grow with your investment

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Is a Child SIPP right for your child?

This might seem a very odd thing to think about today on the school run or a play date. But an early start to long term savings could give your child more financial flexibility in later life and the potential for a more comfortable retirement. If this is a priority for you, consider a Child SIPP Account.

You can make a big difference

Saving for later life is an area where starting early really can make a big difference. Try our savings tool to see what your payments and long-term investment growth could mean for your child’s future.

A word about inheritance tax

If someone dies and leaves assets worth more than £325,000 their estate might have to pay inheritance tax of 40% on anything above £325,000. From 2017 there will be an additional allowance with the introduction of the family home allowance.

If the person has made gifts of money in the seven years before they die, the value of these can be counted towards the value of the estate for paying Inheritance Tax (although the gifts themselves can’t be taken back).

But gifts of £3,000 or less to someone in a year usually don’t have to be counted for this purpose.


Attention grandparents

A Child SIPP can be a good focus for you if you want to invest for your grandchild’s longer term future.

The maximum payment in you could make in a year (£2,880 before tax relief) falls under your £3,000 annual gift allowance for Inheritance Tax.


More about our Child SIPP

Who can have one?

Any child under the age of 18, as long as their parent or guardian has earnings that count for UK income tax or is resident in the UK at some point during the tax year.

What’s the minimum payment?

£50 (either as a one off or regular payment).

What’s the maximum payment?

£3,600 in the 2017/18 tax year. Including tax relief. You can pay in up to £2,800 and we will claim £720 tax relief for you and put it in your Alliance Trust Savings account.

Who can pay in?

A parent or guardian aged 18 or over must open a Child SIPP, but after that anyone can pay in.

Who do the investments belong to?

The child. They will gain control of the investments when they reach the age of 18 but, based on current tax and pension rules, won’t be able to access them until they are aged at least 57.

What are the tax advantages?

Like a Junior ISA, there is no tax to pay on income or investment growth inside a Child SIPP.

Payments in also benefit from tax relief. Meaning that, to get to the £3,600 maximum payment in each year, only £2,880 has to be paid in directly. The rest (£720) is paid in as tax relief which we claim on your behalf.

What are the charges?

£6.65 a month (plus VAT) to hold a Child SIPP with us. You also pay charges on the investments you hold and for any transactions you ask us to carry out. When the child reaches 18 the charges change to £17.50 a month (plus VAT). Read our Charges Guide for the details.

Anything else I should know?

In theory, more than one pension can be opened for a child, but no more than £3,600 can be paid in across all of them in any one tax year.

Alliance Trust Savings Limited is a subsidiary of Alliance Trust PLC and is registered in Scotland No. SC 98767, registered office, PO Box 164, 8 West Marketgait, Dundee DD1 9YP; is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, firm reference number 116115. Alliance Trust Savings gives no financial or investment advice.