POOLING
Updated 1 March 2010
Suffolk Life is undertaking a process change from 15 March 2010 which will see protected and non-protected rights funds administered on a pooled basis. In anticipation of this we will remove additional establishment and annual administration fees for protected rights funds from 1 May 2009 provided your client elects now to pool in March 2010. Where we are aware of any clients where it had been anticipated pooling was being considered prior to 31 December 2009, we will contact you directly to discuss the options available.
Once pooling is implemented, plan holders have the potential to benefit from:
- reduced administration costs;
- all assets being held in a single trust based scheme; and
- a single investment regime with increased flexibility for protected rights.
Timings
New business
As promised we will commence the pooling process on 15th March 2010. From this date new business and transfers in to the Suffolk Life MasterSIPP will be pooled by default.
Suffolk Life SIPP (Deed Poll Scheme)
Where clients have existing Suffolk Life SIPPs (deed poll) as their main plan the timing will be a little different. New MasterSIPPs will need to be established, formal valuations performed and transfers made; to do this as efficiently as possible we will give advisers two months to complete and return forms. Generally, for clients who have elected to pool and who have a plan anniversary date of 1 June, we will send out new application forms and other appropriate documentation from 15 March to advisers for completion in time to start pooling at the next plan anniversary.
Suffolk Life MasterSIPP(Trust based scheme)
For those with a Suffolk Life MasterSIPP with attached protected rights the process is very similar to the above but without the need for a new application form, so the timings will be the same. Generally, those with anniversary dates of 1 June will be contacted shortly after 15 March so we will be ready to pool from 1 June.
Q & As
For further information please see our Q & As below or download our pooling factsheet. If you would like to elect to pool, please complete our Election to pool form.
Visit our Working together section, or find out more about the MasterSIPP.
Why has Suffolk Life decided to pool funds?
In October 2007 we were one of the first providers to allow the self-investment of protected rights using our new MasterSIPP - a full year ahead of the DWP rule relaxation. The record keeping implications for protected rights have remained unclear but it now seems unlikely that there will be any further clarification.
Consequently we will shortly be prepared to operate protected and non-protected rights on a pooled basis. Due to the relaxed requirements of the DWP on the reporting of protected rights monies and backed up by our fully integrated bespoke IT system, we will introduce the pooling of non-protected rights and protected rights as the default option in March 2010.
How will this affect existing business?
From the 1 May we have:- removed the establishment and annual administration fees on protected rights plans
when the following conditions are met:
- only where the protected rights plan is a secondary plan (even if primary is deed poll scheme); and
- if the plan holder elects now to commit to pooling when the pooling facility is made available.
Protected rights fees already charged prior to the introduction of pooling will not be refunded.
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What if the plan holder has a Suffolk Life SIPP (deed poll) and protected rights plan?
Your client will incur no additional protected rights fees once they’ve elected to pool. This is on the assumption that migration takes place on the plan anniversary or at another date as determined by Suffolk Life at our discretion, you will be given notice if this is the case.
If you wish to migrate but outside of the plan anniversary, then there will be a pooling fee. We will provide further details of how this will operate as soon as possible.
However in order to pool your client will need to migrate the non-protected rights plan from the deed poll scheme to our MasterSIPP to pool in this scheme. As migrating from the deed poll scheme to the pooled trust based arrangement within MasterSIPP is a scheme transfer, you are likely to have to consult your clients on this.
If no election to pool is received at the same time as the transfer, each plan will attract its own establishment and annual fees, as per the relevant schedule of fees.
What if the plan holder has a Suffolk Life SIPP (deed poll) and wishes to transfer in protected rights?
From 1 May 2009 until pooling occurs, providing the election to pool is received at the same time as the application for the transfer, there will be no establishment fee for the protected rights plan established under our MasterSIPP, and going forward only one annual fee will be charged covering both the protected rights and non-protected rights plans.Once the pooling facility is available in March 2010 we will then migrate both the deed poll plan and the protected rights plan into one pooled MasterSIPP plan free of charge. This is on the assumption that migration takes place on the plan anniversary or at another date as determined by us at our discretion, you will be given notice if this is the case.
If you wish to migrate but outside of the plan anniversary, then there will be a pooling fee. We will provide further details of how this will operate as soon as possible.
As migrating from the deed poll scheme to the pooled trust based arrangement within MasterSIPP is a scheme transfer, you are likely to have to consult your clients on this.
Will the Suffolk Life SIPP (deed poll) move to be a pooled SIPP?
No. Whilst plan holders can remain in the Suffolk Life SIPP, they cannot hold protected rights funds within it.
What if the plan holder has a MasterSIPP with both protected and non-protected rights?
Your client can elect to pool the non protected rights and protected rights plans right now. There will be no charge for pooling if your client agrees that pooling takes place on the plan anniversary or at another date as determined by us at our discretion, you will be given notice if this is the case.If you or your client wishes to pool outside of the plan anniversary then there will be a pooling fee. We will provide further details of how this will operate as soon as possible.
Can funds already crystallised be pooled?
We are still reviewing the intricacies of crystallised funds, and whether these will be able to be pooled. We will provide further information regarding this at a later date.Back to top
How do I let you know that my client wishes to pool?
Your client will need to complete an Election to pool form which will need to be submitted to your service team.
How will this affect new business?
From the 1 May we have:
- removed the establishment and annual fees on protected rights plans.
when the following conditions are met:
- only when the protected rights plan is a secondary plan; and
- if the plan holder elects now to commit to pooling when the pooling facility is made available.
A confirmation form will have to be completed alongside the MasterSIPP application, and this can be downloaded direct from our literature library. Once pooling is introduced in March 2010 unless otherwise instructed, all new plans will be established on a pooled basis.
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What fees are remaining unchanged?
From 1 May 2009 until pooling occurs, for those that have elected to pool, aside from the establishment and annual administration fees listed above, all other fees will still apply as per the relevant schedule of fees. Therefore some fees, if applicable, for protected rights will remain, including but not limited to:- Investment facility fees;
- Property facility fees;
- Investment manager establishment fee; and
- Investment transaction fees.
Will there be any further fee changes?
Yes. Once a plan is physically pooled (from March 2010 onwards) fees which currently still apply to both protected and non-protected rights funds will then only apply once. These include but are not limited to:- Investment facility fees;
- Property facility fees; and
- Investment manager establishment fee.
The pooling option has the potential to provide better value to plan holder, for example:
Scenario: A plan holder has both non-protected rights and protected rights plans and wishes to transfer into the Suffolk Life MasterSIPP. The adviser chooses to set up an investment manager account as they would like to purchase stocks within the SIPP. This scenario assumes that Suffolk Life does not currently have a global agreement in place with the investment manager and they are not an e-investment affiliate.
In addition to the annual fees and annual investment fees charged per plan, prior to the introduction of pooling the client would have had to establish investment accounts on both plans and incur the £100 fee to do this on each. A pooled MasterSIPP ensures that the fee is applied only once, and may also reduce the amount of deals being placed saving the client transaction charges on both plans therefore providing better value. The adviser may also benefit as they will only have to produce, explain and review one portfolio plan.
Plans will be pooled from 15 March 2010, but fees are being removed immediately on plan anniversaries from 1 May 2009.
There will be no charge for pooling if you agree that pooling takes place on the plan anniversary or at another date as determined by Suffolk Life in our discretion and you will be given notice if this is the case.
Does a plan have to be pooled?
No, pooling is optional. However, plans that are not pooled will still incur the current additional protected rights fees. Once pooling is introduced later this year unless otherwise instructed we will set up all new plans on a pooled basis.Back to top
Can you take an instruction to pool immediately?
You can let us know straight away if you want to change your clients’ plans to a pooled MasterSIPP once the facility is available by completing the Election to pool form.Once the completed form is received by us, the protected rights fees as described will no longer apply from the next plan anniversary. And once we’ve moved the plan to a pooled MasterSIPP then there could potentially be other fees that also no longer apply.
There will no charge for pooling if you and your client agree that pooling takes place on the plan anniversary or at another date as determined by us at our discretion, you will be given notice if this is the case.
If you or your client wishes to pool outside of the plan anniversary or as we elect then there will be a pooling fee. We will provide further details of how this will operate as soon as possible.
What does this mean if I'm an investment manager with existing business?
If you currently manage two different investment accounts (non protected and protected rights) for your client, this will not change until March 2010 on the clients plan anniversary when the separate funds are pooled.
What does this mean if I'm an investment manager with new business?
Clients with both non protected and protected rights transfers in will be set up and held as they currently are with the non protected rights held by Suffolk Life Trustees Limited (SLT), as trustee of the scheme, and the protected rights held by Suffolk Life Annuities Limited in a Trustee Investment Plan issued to SLT. Then on the first plan anniversary after pooling has been launched later this year the total investments will be pooled together in one holding such that the protected rights assets are transferred into SLT investment account.
Your client will not be charged for the establishment or annual fee to set up and administer their protected rights plans. However, if you intend to deal on both plans prior to them being pooled, two different investment accounts will have to be established and the client will be subject to the establishment fee and annual investment accounting fees for both (if applicable).
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DISCLAIMER
The information on this page is for advisers only and should not be relied upon by individuals.