Trustee Investment Plan

Single premium investment for trustees of UK registered Occupational Pension or Self-Invested Personal Pension (SIPP) schemes.

Multi-Asset Fund
Fund size discounts

Investment term flexibility
Free fund switching

Full, partial and regular withdrawals

Product Details

Next steps

Key documents

Trustee Investment Plan - Process Guide

Features and benefits

A range of fund options to suit different needs and attitudes to risk that are not widely available. Our With-Profits Fund and PruFund Funds can provide a balance to higher risk or illiquid assets which may be held in the Scheme, together with growth potential.
As an alternative to holding large cash balances in a trustee’s bank account, the Trustee Investment Plan offers the potential for real growth which could help against the effects of inflation.
Allows trustees of SIPPs and Occupational Schemes outside of Prudential to invest in our With-Profits Fund and PruFund range of funds.
Guarantee options on our PruFund Protected Funds help provide added security, at an extra cost. The PruFund Protected Funds are currently unavailable to new investments.
Regular, partial and full withdrawals. Regular withdrawal facility can provide income (subject to limits) without the need to sell or release funds from other assets held in the scheme which may be less accessible, such as property investments.
Income flows could help cover payments and costs, such as drawdown payments, loan repayments, and any ongoing costs and charges within the scheme.
A Fund Size Discount is applied to the Annual Management Charge depending on the size of the fund.

The value of an investment can go down as well as up. Your client could get back less than they paid in.

About the Trustee Investment Plan

Our Trustee Investment Plan is for Trustees of UK registered Occupational Pension Schemes and Self Invested Personal Pension Schemes (SIPPs). It allows Trustees to invest in our range of funds – to grow investments over the medium to long term.

Investments from SIPPs will be set up for a named individual – known as a “member designated” plan. Other UK registered Occupational Pension Schemes can also designate the plan to an individual member if they wish to do so. However, plans can only be member designated at the start of the plan. Clients can only access the With-Profits Fund if the plan is member designated.

For member designated plans:

You can only invest in the With-Profits Fund if the member is under age 85.
You cannot choose a PruFund Fund if the member is aged 98 or over.
You cannot choose a PruFund Protected Fund with a guarantee term that ends on or after the member’s 99th birthday.

Who can invest?

Trustees of UK registered Occupational Pension Schemes, including Small Self-Administered Schemes (SSAS) and deferred arrangements
Trustees of Self-Invested Personal Pension Schemes (SIPPs)

Contributions

Minimum initial investment: £20,000
Minimum additional investment: £10,000
Additional investments will be set up as a new TIP

Maximum investment is normally £1,000,000. We may accept higher value contributions on request. For plans set up from 7 November 2011, there is no set investment term. For plans set up before this date, Selected Investment Term (SIT) applies.

Withdrawals

Trustees can:

Cash in the plan at any time.
Take a partial withdrawal (providing the withdrawal exceeds £1,000 and £1,000 is left in the plan).
Take regular withdrawals from the plan; monthly, quarterly, six-monthly or annually (up to 100% of the original investment each year). If invested in the With Profits Fund, the maximum limit is 7.5% per year of original investment and this limit can reduce if partial withdrawals are also taken.

Full and partial withdrawal from the With-Profits Fund may incur a MVR.

See the Key Features Document (PDF) for more information.

How the Trustee Investment Plan Works for client income

Using Trustee Investment Plan for drawdown

A TIP can be used within a Self-Invested Pension Plan (SIPP) to meet a client's income drawdown requirements.

For example, a client with a SIPP could use TIP to provide their income drawdown payments. This allows the client to invest remaining funds within the SIPP or other investments that suit their needs and attitude to risk.

Investing in PruFund to provide income

Within a TIP, funds can be invested in PruFund (PDF) to help provide an income. The Net Expected Growth Rate (EGR) can help cover drawdown payments.

The Capped Drawdown GAD can help with calculations relating to income drawdown.

Investment information

Fund options

Pension Tax Relief and Annual Allowance

The rules on tax relief and annual allowance can often lead to great confusion and frustration for clients. Therefore, this is a key area of financial planning to understand to ensure the right client outcomes are obtained.

By the end of this session you'll be able to:

Describe the operation of annual allowances
Explain the interaction of the tax relief and annual allowance rules
Demonstrate how pension funding planning is affected by tax relief and annual allowance(s)

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View slides

The Trustee Investment Plan (TIP) offers access to a broad range of funds, which includes Prudential’s Multi-Asset funds – With-Profits Fund and PruFund range of funds – which are managed by the M&G Treasury & Investment Office (T&IO), experts in asset allocation and multi-asset fund management.

Fund choices can be changed at any time. The trustee can select to invest in a maximum of six funds under each TIP plan. Note each PruFund & SafeGuard fund counts as two funds - see the Key Features document (PDF) for more.

For plans set up from 7 Nov 2011, there is flexibility to invest for as long as required.

The PruFund range of funds and With-Profits Fund

The Trustee Investment Plan allows trustees of SIPPs and Occupational Schemes outside of Prudential to invest in our PruFund range of funds and With-Profits Fund.

These multi-asset funds are not widely available.

These funds:

offer smoothed returns that provide growth potential and which could help against the effects of inflation
offer an alternative option for medium to long term (5 to 10 years or more) investments to a trustee bank account that may be attracting low rates of interest
offer fund options that suit different attitudes to risk and objectives
offer guarantee options that provide added security
provide a balance to higher risk investments in the Scheme

Find out more about the PruFund range of funds (PDF).

Find out more about the With-Profits fund (PDF).

Other funds

Access additional internally and externally managed funds, which offer a range of assets to suit differing client needs.

Find out more about fund availability (PDF).

Find out more about the performance of the funds.

Guarantees

In an uncertain economic climate, clients may look for additional security for their investment. To address this, we offer guarantee options within our TIP.

PruFund guarantees

The PruFund Protected Funds are currently unavailable to new investments.

We offer guarantees for the PruFund Protected Cautious Fund and PruFund Protected Growth Fund . At the end of the selected guarantee term the fund will be worth at least the amount your client invested (subject to charges, enhancements or withdrawals).

With-Profits Fund guarantees

For investments in the With-Profits Fund, we offer a Market Value Reduction-free guarantee on any regular withdrawals or on death.

For plans set up before 7 November 2011, we guarantee not to apply an MVR when the plan is cashed in at the end of the Selected Investment Term.

Charges and discounts

The main charges are :

Annual Management Charge (AMC)
charges for guarantees (if any are taken)
Adviser charges (a set-up charge and ongoing charges, if agreed with your client

Annual Management Charge

We will take a charge every year for managing the plan and investments. The amount charged will depend on the funds your client invests in.

PruFund Funds: the AMC is deducted as a percentage of the units every month. Note that if a client has only invested in a PruFund Fund for part of a month, we still take a full month's charge.
With-Profits Fund: the annual management charge depends on the Fund performance - in particular, the investment return and our expenses. We currently expect this charge to be about 1.26% a year based on the assumption that future investment returns from the Fund will be 5% per year.

Further information on how much we charge for each fund can be found in the TIP Fund Guide (PDF) which you can share with clients.

Fund Size Discount

Discounts are applied to the basic Annual Management Charges based on the size of the fund (Fund Size Discount):

Fund Size	AMC Discount
Less than £100,000	0.350%
£100,000 - £149,999	0.400%
£150,000 - £249,999	0.450%
£250,000 – £499,999	0.4750%
£500,000 – £749,999	0.500%
£750,000 - £999,999	0.525%
£1m and over	0.550%

The discount to the AMC will apply to the whole of the investment , not just the portion above the threshold levels.

For more information on Fund Size Discounts see the Fast Facts Document (PDF).

Guarantee charges

The PruFund Protected Funds are currently unavailable to new investments.

Find out more about the charges for guarantees on our With-Profits Fund

With-Profits Fund (PDF)

Market Value Reduction

For investments in the With-Profits Fund, an MVR may apply if the client withdraws funds, switches funds or if the plan is cashed in. However, we offer an MVR-free guarantee:

on any regular withdrawals
on death*
for plans taken out before 7 November 2011, when cashed in at the end of the Selected Investment Term

*Investments in the With-Profits Fund are only available if the TIP has been set up for a named individual - 'member designated'.

Adviser Charges

Adviser charges are broken down into:

Set-up Adviser Charges: We have limits which set out the maximum level of Adviser Charging which we will facilitate. For Set-up Adviser Charges this is 5% of the single premium or £30,000, whichever is lower.
Ongoing Adviser Charges: We have limits which set out the maximum level of Adviser Charging which we will facilitate. For ongoing Adviser Charges this is 1% of the fund value.

Adviser charges must be in accordance with HMRC rules and will be tested to ensure they do not exceed the relevant limit for the TIP.

Find out more about adviser charging and limits in the Fast Facts document (PDF).

If you would like to request a TIP Illustration please contact us on 0808 234 0808 or email us at sales@Prudential.co.uk. Alternatively you can request this through your Account Manager.

"Prudential" is a trading name of Prudential Distribution Limited. Prudential Distribution Limited is registered in Scotland. Registered Office at 5 Central Way, Kildean Business Park, Stirling, FK8 1FT. Registered number SC212640. Authorised and regulated by the Financial Conduct Authority. Prudential Distribution Limited is part of the same corporate group as the Prudential Assurance Company Limited. The Prudential Assurance Company Limited and Prudential Distribution Limited are direct/indirect subsidiaries of M&G plc which is a holding company registered in England and Wales with registered number 11444019 and registered office at 10 Fenchurch Avenue, London EC3M 5AG, some of whose subsidiaries are authorised and regulated, as applicable, by the Prudential Regulation Authority and the Financial Conduct Authority. These companies are not affiliated in any manner with Prudential Financial, Inc, a company whose principal place of business is in the United States of America or Prudential plc, an international group incorporated in the United Kingdom.