UK Self-Invested Personal Pensions (SIPPs) may not be completely protected from inheritance tax if the original Inland Revenue documentation...

UK Self-Invested Personal Pensions (SIPPs) may not be completely protected from inheritance tax if the original Inland Revenue documentation is used, according to pensions expert Alec Ure. Acccording to a report in the UK's Daily Telegraph Mr Ure, not only the author of a textbook on SIPPs and a former Inland Revenue staffer, said: "The Revenue's model rules were initially incorrect and had to be revised because they didn't include the necessary discretionary trust wording. "Where bad draughtsmen have bolted the draft rules onto a SIPP product,there may be problems in the future," Mr Ure warned. However, many providers use documentation specifically drawn up for them but some are still using boilerplate material originally provided by the Inland Revenue when this scheme was brought in. Aon's head of executive pensions, Bhargaw Buddhdev told WealthBriefing that it was very unlikely that there would be a problem with bespoke documentation and that if there were any problems they would probably be confined to the initial Revenue model rules. Mr Buddhdev continued, "If there are any problems these can be easily rectified. The main issue here is that all pensions documentation will need changing soon to take into account changes brought in by last year's Finance Act. This gives investment flexibility to all pension schemes. "From 2006 SIPPs will be given even greater investment freedom. We are finding that the ability to invest in residential property including buy to lets is generating particular interest". Other pensions experts contacted by were surprised that this issue had been raised and major providers of such pension products have denied that there is a problem with the wording of SIPPS documents.