Deal of the week: Pension sharedealing for £9.95

What’s the deal?

Sippdeal’s e-Sipp, a low-cost self-invested personal pension (Sipp), has reduced its dealing charge for online trades to a flat £9.95.

The commission rate applies to purchases and sales of shares, investment trusts, exchange traded funds (ETFs) and bonds – plus unit trusts and other open-ended investment funds. The new fixed tariff compares with previous online costs of up to £29.95, depending on the deal size. The low rate is payable by new and existing Sippdeal customers.

Is this good?

The £9.95 dealing charge is among the lowest by a Sipp for share trades. Sippdeal says the price reduction reflects the “very low maintenance” required by online clients, and is aimed at appealing to the growing numbers of self-directed pension investors. The e-Sipp plan also has no annual, set-up or contribution charges – making it very competitive overall for share-based investors.

What’s the catch?

The £9.95 dealing commission also applies to unit trusts and open-ended investment companies (Oeics), although Sippdeal heavily discounts the initial charges on many of these funds. Phone-based transactions cost £29.95.

While Sippdeal’s e-Sipp is generally low-cost, for plan-holders subsequently transferring out to another provider it levies a charge of £20 plus VAT per line of stock, plus a £75 plus VAT plan fee.

What’s the alternative?

Hargreaves Lansdown’s low-cost Vantage Sipp levies no additional dealing or plan fees for investing in open-ended funds. But, for shareholdings, it charges 0.5 per cent plus VAT per year as well as dealing commissions of up to £29.95 per deal.

Alliance Trust’s Select Sipp rebates the annual “trail” commission it receives from unit trust companies to investors.

These rebates range up to 0.75 per cent a year on fund-holdings. But the Sipp also charges £12.50 for all online trades and has a £75 plus VAT annual fee.

How do I find out more?

Tel: 0845 54 32 600 or go to www.sippdeal.co.uk

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