SIPP Overview
What is a SIPP?
A SIPP account is a pension account that allows customers to control their retirement savings and where they are invested. SIPPs provide customers with more flexibility and self control over their savings, and are available to all UK residents between the ages of 18 and 75. Customers who are employed or self-employed may contribute up to 100% of their earnings (up to £235,000) in any one tax year. Further they allow retired and unemployed customers to invest up to £3,600 per year. You can trade financial products, property and other items in a SIPP.
Interactive Brokers (UK) Limited does not accept SIPP’s outright, rather it does accept a SIPP Administrator of a SIPP to open a master account. Afterwards, a SIPP Administrator's clients can open sub accounts and trade their SIPP through Interactive Brokers (UK) Limited.
For more information about SIPP’s in the UK, refer to the HM Revenue & Customs website www.hmrc.gov.uk
Can I open a SIPP account with Interactive Brokers LLC (US) or (Hong Kong)?
No, the SIPP Administrator account and its sub accounts can only open an account with Interactive Brokers (UK) Limited.
Can I trade property and other acceptable investments through my SIPP at Interactive Brokers (UK) Limited?
You can only trade regulated financial products through your SIPP that is held with us.
What is a SIPP Administrator?
A SIPP Administrator is a regulated company with the Financial Conduct Authority in the United Kingdom that acts as the trustee of the SIPP. Further it provides various administrative duties on behalf of the SIPP e.g., reporting to HM Revenue & Customs.
How do I get my SIPP Administrator to open a master account?
Refer to our Interactive Brokers (UK) Limited website www.interactivebrokers.co.uk under Account, then under SIPP. From here a SIPP Administrator can open a master account (at no cost). Alternatively you can contact an Interactive Brokers (UK) Limited sales representative.
What qualifies a SIPP Administrator to open a master account?
We only accept UK registered companies with the Financial Conduct Authority which are authorised SIPP Administrators that are in good standing and adhere to our terms and conditions.
Is there a cost to open a master account?
No, unless the master account wants to view market data then fees apply.
Can anyone trade a SIPP sub account with Interactive Brokers?
Only UK residents and individuals between the ages of 18 and 75 who have good or extensive knowledge of any product they wish to trade and that we support, prior execution of 100 or more trades (of any product) and will make a minimum deposit of $5,000 or equivalent in stock.
Can I trade on margin (leverage)?
No, all SIPP sub accounts can only trade in a cash account.
What is a cash account?
A cash account only allows a sub account to trade stocks, bonds, equity options, futures, futures options, single stock futures (SSFs), ETFs, forex and warrants. An individual can only deposit one base currency that Interactive Brokers supports, but can trade products denominated in other currencies after using a Forex transaction to acquire the currency. You must wait for the Forex trade to settle (two business days following trade date) before the currency is available for trading. Cash accounts can only trade the following order types: long stock (no shorting), long calls or puts, covered calls, protective puts, short naked puts and call spread, put spread.
What are the costs to open a sub account?
Initial deposit $5,000 + $10 minimum brokerage fee per month + IB brokerage fees (applicable) + Market data fees (if applicable) and other costs may apply.
Can I trade my ISA through Interactive Brokers?
No, we only accept SIPP accounts.
Does Interactive Brokers give advice in trading within your SIPP?
No, Interactive Brokers give no trading advice as it is a non discretionary broker.
Do you accept cheques to fund my SIPP?
No we only accept wire transfers or positions (FREE of PAYMENT).
What is a FREE of PAYMENT transfer?
The transfer of securities for which there is no need for a cash exchange. Rather the securities are already paid up in full.
Can I transfer physical shares (FREE of PAYMENT) in my sub account?
No we only accept dematerialized shares.
How many users can trade my SIPP sub account?
Only one.
Adding a second user for an individual account holder
Overview:
Individual account holders have the ability to add multiple users to their IB account. The account holder may wish to add a second user registered under their own name for the purpose of opening two TWS sessions simultaneously (one for normal access and the other for connecting via an API). The account holder may also provide access to up to 15 (non-employee) individuals, such as a family members, pursuant to a Limited Power of Attorney agreement. In addition, each of these individuals may also be provided with a second user access.
In each case, the additional user will be assigned a unique username which is required for log in both to Account Management and the trading platform of choice. Procedures for adding a second user account for access by the existing account holder are outlined below (search KB1001 for procedures for adding non-employee users).
Background:
Procedures for adding a second (account holder) user are as follows:
- Log into Account Management.
- Select the Account Administration and then User Access Rights menu options.
- Click on the 2nd User link next to the account holder's name.
- You will be presented with the Add New User and Access Rights page where you will need to specify the first five characters of the new user name and the password you wish to use for that particular user name. As this user is intended to be accessed solely by the existing account holder, it will have access to all Account Management functions (i.e., Account Administration, Funds Management, Report Management, Trading Access and User Management.
- Click on the Continue button.
- Verify details and click on the Continue button.
- The account holder will then need to log into Account Management under the new user name. At that point a token confirmation number will sent to their email for the purpose of creating a new password.
- Please note user add requests are subject to processing which, after the above steps have been completed, may take up to 2 business days prior to access being provided.
IMPORTANT NOTES:
1. In accordance with market data vendor requirements, the account will be assessed a separate market data subscription fee for each user account added. In addition, user account market data subscriptions are tied to and cannot vary from that of the account holder.
2. Account holders may delete a 2nd user account by clicking on the delete link next to the user name located within the Account Administration and then User Access Rights menu options.
Links:
Free of Payment (FOP) Transfers
Overview:
Free of Payment (FOP) is term used by IB to refer to a process of transferring long US securities between IB and another financial institution (e.g. bank, broker or transfer agent) through the Depository Trust Company (DTC).
The FOP transfer method is often used when:
1. The delivering form is not a DTC ACAT (Automated Customer Account Transfer) Participant.
2. The customer would like to expedite the delivery of their securities. The processing time frame for securities transferred via FOP may, in certain instances, be less than that associated with an ACATS transfer.
The following steps are to be followed in order to create a FOP notice:
1. Log into Account Management.
2. Select Funding or Funds Management and then Position Transfers.
3. From the drop-down list, select the Transfer Method: Free of Payment.
4. Select the applicable transaction Type: Deposit or Withdraw.
5. In the case of a FOP Withdrawal, the steps are as follows:
- Select the Destination to whom the securities are being transferred.
- Enter your account number of the Third Party Broker Acount Information.
- Specify the security (Stock, Warrants or US Bonds).
- Enter the Symbol, Shares and the Exchange (optional) and click Add.
- Provide your electronic signature authorizing the transfer request and clicking on the Continue button.
- Verify your identity by entering your password and clicking on the Confirm Request button;
- If your account is enrolled in the Secure Transaction Program (STP), the processing of your request will take place once you enter your confirmation code and click on the Confirm Request button. If not STP enrolled, your request will be subject to security verification, requiring that you contact our Customer Service Center to validate your identity and request.
6. In the case of a FOP Deposit, the steps are as follows:
- Select the Source to whom the securities are being transferred.
- Enter your account number of the Third Party Broker Acount Information.
- Specify the security (Stocks, Warrants or US Bonds).
- Enter the Symbol, Shares and the Exchange (optional) and click Add.
- Provide your electronic signature authorizing the transfer request and clicking on the Continue button.
- A printable version of the FOP request is made available should your transferring firm require an authorization form.
7. Transfer requests are typically completed within five business days.
IMPORTANT NOTE:
While IB does not assess a fee to process FOP transfers, other firms may and we therefore recommend that you confirm with the contra-firm their policies in this regard prior to submitting a request. In the event a contra-firm does charge a fee to IB, the fee will be passed to the IB account holder.
Glossary terms:
Adding (non-employee) users to an individual account
Overview:
Individual account holders have the ability to add multiple users to their IB account. The account holder may wish to add a second user registered under their own name for the purpose of opening two TWS sessions simultaneously (one for normal access and the other for connecting via an API). The account holder may also provide access to up to 15 (non-employee) individuals, such as a family members, pursuant to a Limited Power of Attorney agreement. In addition, each of these individuals may also be provided with a second user access.
In each case, the additional user will be assigned a unique username which is required for log in both to Account Management and the trading platform of choice. Procedures for adding a (non-employee) individual user are outlined below (search KB1004 for procedures for adding a second user for an individual account holder).
Background:
Procedures for adding a non-employee user are as follows:
- Log into Account Management.
- Select the Account Administration and then User Access Rights menu options.
- Click on the Add User button.
- You will be presented with the Add New User and Access Rights page where you will need to specify the first and last name of the individual who you wish to provide access, the first five characters of the user name, a password, that individual’s email address, and relationship to the Account Holder.
- Specify those functions which you which to provide access. These will be restricted to Report Management (activity statements, confirms, margin and tax reports), Trading Access (product/exchange configuration, paper trading account) and User Management (updating password, email address or personal information). User will not have access to the Funds Management or Account Administration functions and will therefore have no ability to perform tasks such as transferring assets, updating the information of the account holder, adding additional users or closing the account.
- Click on the Continue button.
- Verify details and click on the Submit button.
- Provide electronic signature to the Limited Power of Attorney agreement and click on the Continue button.
- If Trading Access has been provided, select the Home and Pending Items menu options and accept the Trader Authorization Form by clicking on the Continue button.
- The account holder will then need to contact the individual added as a user and provide them with the user user name and password combination they have selected.
- The new user will need to log into Account Management and confirm their email address by entering the token confirmation number sent to the address as provided. At that point another token confirmation number will sent to their email for the purpose of creating a new password and the user will then be prompted to fill out personal information on the New User Confirmation page and sign the Limited Power of Attorney agreement.
- Please note user add requests are subject to processing which, after the above steps have been completed, may take up to 2 business days prior to access being provided.
IMPORTANT NOTES:
1. In accordance with market data vendor requirements, the account will be assessed a separate market data subscription fee for each user account added. In addition, user account market data subscriptions are tied to and cannot vary from that of the account holder.
2. Account holders may delete a user account by clicking on the delete link next to the user name located within the Account Administration and then User Access Rights menu options.
Links:
Transfer on Death
Transfer on Death is a form of account registration which allows individuals to pass the assets in their IB account directly to another person or entity upon their death without having to go through probate. This registration option is solely available to individual accounts held by US residents (no joint or IRA accounts).
To elect this option, eligible account holders will need to do the following:
1. Log into Account Management and select the Account Administration and then Transfer on Death menu options.
2. You will need to specify your Primary Beneficiaries (from 1 to 6 whose percentage of ownership must total 100%)
3. You may elect to specify your Contingent Beneficiaries (from 1 to 6 whose percentage of ownership must total 100%). If you do not elect any Contingent Beneficiaries you will need to specify how you wish the interests of any Primary Beneficiaries that predecease you shall be treated (either pass back to the account holder's estate or pass to the remaining Primary Beneficiaries).
4) In the event any Primary or Contingent Beneficiary is a minor you will be required to designate an authorizer signer.
5) You will then be provided with a link to a pre-populated Transfer on Death Agreement which requires formal signature and notarization. Instructions are also provided for submitting the form to IB's New Accounts department. If the account holder is married and living in a community property state, spousal consent is required if the spouse is not named as the primary beneficiary (it is the responsibility of the account holder to make this determination).
6) Once the agreement has been returned and reviewed for approval, the registration will be complete and the account title amended (e.g. Jane Doe, TOD). Statements will also refelect this new account title.
7) Account holders may remove the TOD request prior to approval or revoke once approved (both via online option). A new agreement will need to be completed, signed and returned prior to the revocation becoming effective. In order for a revocation request to be effective, it must be received and approved by IB prior to the account holder's death.
8) In the event of the death of the account holder, the beneficiary will need to complete and remit the notarized Transfer on Death - Beneficiary Distribution Form to IB along with a certified copy of the death certificate. If the beneficiary does not already have an account with IB they will need to open one in order to transfer the percent of assets as indicated in the Transfer on Death Agreement.
How to deposit funds via bank wire transfer
To make a wire deposit to your account you will first need to provide a deposit notification through Account Management. Once logged into Account Management, select the Funds Management and then Funds Transfers menu options. From there you will select the Transaction Type of "Deposit" and the Method of "Wire".
You will then be prompted to input your delivering bank details including deposit amount, currency of denomination and sending institution. Once that information has been input you will be provided with all the details (e.g., ABA number, Swift BIC Code and bank account number) in a printable form which you, in turn, can provide to your bank in order for it to initiate the wire transfer.
Please note that creation of this notification is essential as the details necessary for your bank to wire funds vary by the currency in which the wire is denominated. In addition, this notification also serves to ensure that the funds are properly matched to your account immediately upon arrival.
Should you have further questions, please contact one of our Customer Service Centers. Contact numbers and hours of operation may be found through the following website link: http://individuals.interactivebrokers.com/en/index.php?f=1560
Links:
Availability of proceeds in a 'Cash' type account
Accounts which have been set up as a 'Cash' type do not have access to the proceeds from the sale of securities until such time the transaction has settled at the clearinghouse and proceeds have been issued to IB. Securities settlement generally takes place on the third business day following the sale transaction. Providing access to the funds prior to settlement would constitute a loan, a transaction which is precluded from taking place within this account type.
Account holders who wish to have access to settled funds prior to the settlement day may do so by electing an account type of 'Margin'. Under this account type unsettled funds may be used for trading purposes but may not be withdrawn until settlement. Account holders maintaining a 'Cash' account may request an upgrade to a 'Margin' type account by logging into Account Management and selecting the Trading Access and then Trading Configuration menu options. Upgrade requests are subject to a compliance review to ensure that the account holder maintains the appropriate qualifications.
Links:
Updating Financial Information
Overview:
IB requires that customers provide through the application process financial information including: 1) Investment objectives and intended purpose of trading; 2) Investment experience (by product type); and 3) Financial qualifications (e.g., net worth, liquid net worth, and annual income). Customers are also obligated to promptly notify IB of any changes and may do so through Account Management.
Background:
Customers may update their financial information by logging into Account Management and selecting the Account Administration and then Financial Info menu options. Note that any changes made to this information is subject to a Compliance review to ensure that account permissions remain suitable.
I have received notice that the Non-Individual Taxpayer Identification Number (TIN) on my IB account does not match that of the IRS. What do I need to do?
Why Your TIN May Be Considered as Incorrect
If you are a non-individual, such as a corporation, LLC, partnership, trust or similar entitiy, your TIN will usually be your Employer Identification Number (EIN). Often a non-individual taxpayer EIN does not match IRS records because you have provided IB with a “Doing Business As” name rather than the “Legal Name”. Similarly, the EIN will not match if it is not the number of the actual owner of the account (e.g. you have provided IB with the SSN of a partner rather than the EIN of the partnership).
What You Need To Do
You will need to compare the name and EIN per your records (e.g. recent business tax return) with the name and TIN on your IB account. Information regarding your IB account including a form for updating your information will be made available upon log in to Account Management. This comparison will require that you take one of the four actions outlined below. If you have any questions regarding your name and/or TIN as recognized by the IRS, please call the IRS Business and Specialty Tax Line at 1-800-829-4933 for assistance.
1. If the name and EIN on your account agree with the name and EIN per your records – Write the Internal Revenue Service Center where you file your income tax return and ask the IRS to send you a Letter 147C. This letter will confirm the name/TIN combination the IRS has on file for you. Once you are in receipt of this letter provide a photocopy to IB along with proof of identity and proof of address.
2. If the EIN on your account is different from the EIN through which you submit your business tax returns, but the name is the same - Update your EIN through the form made available upon login to Account Management. You do not need to contact the IRS.
3. If the name on your account is different from that through which you submit your business tax returns, but the EIN is the same on both
a. If the name on your account is correct, contact the IRS to correct the name. Request that the IRS to send you a Letter 147C and once you are in receipt of this letter provide a photocopy to IB along with proof of identity and proof of address;
b. If the name per the IRS records is correct, update your personal information through Account Management. Provide photocopies of supporting documentation (proof of identity and proof of address). You do not need to contact the IRS.
4. If both the name and EIN on your account are different from the name and EIN through which you submit your business tax returns
a. If the name and EIN per the IRS records is correct, update your personal information through Account Management. Provide photocopies of supporting documentation (proof of identity and proof of address). You do not need to contact the IRS;
b. If the name and TIN on your account is correct, contact the IRS to correct the name. Request that the IRS to send you a Letter 147C and once you are in receipt of this letter provide a photocopy to IB along with proof of identity and proof of address.
Links:
How can I discontinue the issuance of duplicate copies of my trade confirmations and statements to my former employer?
In order to effect this change you will first need to update your employment by logging into Account Management and selecting the Account Administration and then Account Information menu options. From there you may modify your personal information including employment. If the nature of your prior employment also involved membership in an exchange, regulatory or self-regulatory organization, or you were an associated person, affiliated person or employee of an exchange member, and these no longer hold true, you will need to change your answer to this question as contained within the Regulatory Info menu option also contained under Account Information.
Finally, please instruct your former employer to send an email to newaccounts@interactivebrokers.com in order to independently confirm this request to discontinue sending duplicate statements. If your new employer is also a financial institution which, for in-house compliance purposes and/or as a result of regulatory mandate monitors the trading activities of their employees, they will need email a request to newaccounts@interactivebrokers.com in order to receive duplicate statements and trade confirms.
