How To Transfer Workplace Pension To SIPP: Fees, Rules, Complete Step-By-Step Guide

A workplace pension can usually be transferred to a Self-Invested Personal Pension (SIPP) once you have left the job it was set up through, though rules differ between defined contribution and defined benefit schemes. 

Under FCA rules, transferring to a SIPP can give UK savers wider investment choice, but may mean giving up valuable guarantees.

Key takeaways

• Old workplace pensions can usually be transferred to another pension scheme, but transferring an active pension may mean losing employer contributions if your employer will not pay into the new scheme.
• Unfunded public sector defined benefit schemes, including the NHS Pension and Teachers’ Pension, cannot be transferred to a SIPP under any circumstances.
• Under FCA rules, transferring a defined benefit pension worth £30,000 or more legally requires regulated financial advice.

Can I transfer my workplace pension to a SIPP?

Yes, you can usually transfer an old workplace pension into a SIPP, although you should check whether transferring an active pension would affect your employer contributions. The rules differ significantly between defined contribution and defined benefit schemes.

HM Revenue & Customs requires the receiving SIPP to be a registered pension scheme before any money moves across.

If your workplace pension is defined contribution, the transfer is usually straightforward. Your new SIPP provider will usually give you a transfer form and contact your existing provider to arrange the transfer. Defined benefit pensions require a different process, covered in the sections below.

For the full workplace pension vs SIPP comparison, including charges and investment range, see the table further down this guide.

How to transfer a workplace pension to a SIPP, step by step

Once you’ve checked eligibility, advice requirements and fees, the transfer usually follows the same basic steps.

1. Choose a SIPP provider and open an account, providing your National Insurance number and personal details.
2. Locate your old pension’s provider name, policy number and approximate value.
3. Understand that most workplace pensions cannot transfer funds directly (“in-specie”). Expect a cash transfer, which leaves you temporarily “out of the market”
4. Submit the transfer request; your new provider contacts your old scheme on your behalf.
5. Wait for completion. Electronic transfers via the Origo network usually take 10–14 days, whereas manual or paper-based transfers take two to six weeks.

Which pensions can never be transferred to a SIPP?

Unfunded public service pension schemes, including the NHS Pension Scheme, Civil Service Pension Scheme and Teachers’ Pension Scheme, operate differently from funded occupational schemes.

Their transfer rules depend on the scheme and the type of transfer, so you should check the scheme rules before assuming a transfer to a SIPP is possible.

The following workplace pensions fall into this unfunded category:

• The NHS Pension Scheme
• The Teachers’ Pension Scheme
• The Civil Service Pension Scheme
• Armed Forces, police and fire service pension schemes

Funded defined benefit schemes work differently. The transfer rules for funded defined benefit schemes differ from those for unfunded public service schemes, and the scheme’s own rules will determine whether a transfer is available.

Do you need financial advice before transferring?

Yes. If the value of your defined benefit pension rights exceeds £30,000, the scheme must ensure you have taken appropriate independent advice before allowing the transfer to proceed.

This requirement is set out in the Pension Schemes Act 2015 and enforced through the FCA’s Conduct of Business Sourcebook, rule COBS 19.1. The £30,000 figure relates to your Cash Equivalent Transfer Value, not your annual pension income.

According to the Financial Conduct Authority, advisers must start from the position that keeping a defined benefit pension is usually right for most people.

A Pension Transfer Specialist assesses your circumstances, and FCA rules require pension transfer advice to be given or checked by a Pension Transfer Specialist.

Even below £30,000, it may be worth considering financial advice because transferring can mean giving up valuable benefits.

If you’re weighing up whether a defined benefit pension from a scheme like the Mineworkers’ Pension Scheme is worth transferring, a regulated adviser can compare the guaranteed income against what a SIPP might realistically achieve.

Note on older Defined Contribution schemes

It isn’t just defined benefit pensions that contain valuable guarantees. Many older defined contribution workplace pensions (typically older insurance-backed policies taken out before the 2000s) include Guaranteed Annuity Rates (GARs).

If the value of a GAR exceeds £30,000, FCA rules dictate that you must also take regulated financial advice before transferring to a SIPP, as you would be giving up a highly valuable, guaranteed retirement income rate.

Workplace pension vs SIPP: what’s actually different

A workplace pension is set up and part-funded by your employer, while a SIPP is a personal pension you fund and manage yourself. The table below sets out the main practical differences to consider before transferring.

Charges vary significantly between SIPP providers, so costs are just as important as investment choice.

What happens to your employer’s contributions if you transfer?

If you leave a job, you and your employer will normally stop making contributions to that workplace pension. The money already saved remains yours, and you may be able to transfer it to another pension scheme.

If you want your employer to contribute to a SIPP, your employer would need to agree to make contributions to that scheme.

Some employers offer this through a salary sacrifice arrangement, where you give up part of your salary in exchange for a larger employer pension contribution, resulting in National Insurance savings for both you and your employer.

Whether your employer extends this to a SIPP rather than their chosen scheme depends entirely on their payroll setup.

Can I do a partial transfer of my workplace pension to a SIPP?

Yes, many SIPP providers accept partial transfers, letting you move some of your pension pot while leaving the rest in place. Not every provider offers this, so checking first matters.

1. Confirm your current scheme allows partial transfers, some do not.
2. Check your chosen SIPP provider accepts partial transfers; not all do.
3. Decide the amount or percentage you want to move.
4. Remember safeguarded benefits, such as a guaranteed annuity rate, usually can’t be split.

A partial transfer can give you more control without moving your entire pension to a new provider.

What fees should you check before transferring?

Exit fees, ongoing platform charges and fund costs can all affect whether a transfer genuinely leaves you better off. Compare these costs rather than assuming a SIPP is automatically cheaper.

• Exit or transfer-out fees charged by your current workplace scheme
• Annual platform or administration charges on the new SIPP
• Fund management charges on the investments you choose
• Dealing charges if you plan to trade shares actively

For certain personal and stakeholder pensions entered into before 31 March 2017, FCA rules restrict an early exit charge to the lower of 1% of the benefits being taken, converted or transferred, or the lower amount provided for under the scheme’s arrangements.

If you believe you’ve been charged unfairly during a transfer, the Financial Ombudsman Service can investigate complaints against regulated providers.

When can you access it, and how long does the transfer take?

Access age

You can normally access a pension from age 55, rising to 57 from 6 April 2028. Some people have a protected pension age that allows them to access pension benefits before 57, subject to the relevant conditions. 

This protection is separate from the UK State Pension age, which currently sits between 66 and 68 for both men and women depending on your date of birth.

Transfer timing

A pension transfer often takes between two and six weeks, although the time can vary between providers and depending on the type of transfer. Your provider can have up to six months to action the request.

Is it worth transferring your workplace pension to a SIPP?

Whether transferring is worth it depends on your scheme type, how confident you feel managing investments, and how many years remain until retirement.

• More control over where your money is invested
• Wider fund and share choice than most workplace schemes
• Easier to track everything through one provider
• Loss of any guaranteed benefits if transferring a defined benefit pension
• Full responsibility for investment decisions and performance

FSCS protection may apply if a regulated pension provider, investment firm or adviser fails, subject to the relevant rules and compensation limits. It does not protect you from normal investment losses.

Before deciding, it can help to work out how much you may need in retirement and consider whether consolidating your pensions fits your circumstances.

Quick Decision Checklist: Should you transfer?

Consider transferring if:

• You have multiple small pots from old jobs and want to consolidate them to reduce administrative headaches.
• Your old workplace pension charges high fees (above 0.75%) compared to a low-cost SIPP platform.
• You are an experienced investor who wants access to individual stocks, investment trusts, or specialist ETFs not offered by workplace default funds.

Think twice about transferring if:

• You are still contributing: If you transfer an active pot, massive UK master trusts like NEST or The People’s Pension may require you to cease active membership, meaning you lose your employer’s matching contributions.
• You have protected benefits: Transferring could strip away a protected early pension age (e.g., the right to access at 50 or 55) or protected tax-free cash entitlements exceeding the standard 25%.
• Your current fees are rock-bottom: Some large employer schemes negotiate institutional discounts, meaning your workplace pension might charge as little as 0.20% to 0.30% annually, often cheaper than a retail SIPP.

Conclusion

Transferring an old defined contribution workplace pension to a SIPP is often possible, although the rules can be more restrictive where a pension has valuable guarantees or defined benefit rights.

Weigh up fees, lost guarantees and your own investment confidence before deciding. Transferring a workplace pension to a SIPP can give you greater control over your retirement savings, but you need to weigh that against fees, investment risk and any benefits you could lose.

FAQs

What is the 3-year rule for a SIPP?

No. The three-year rule does not relate to transferring a workplace pension to a SIPP. It refers to pension carry-forward, which can allow you to use unused annual allowance from the previous three tax years, subject to the relevant rules.

Can I transfer a SIPP back into a workplace pension?

Yes, though it’s uncommon and depends on whether your new employer’s scheme accepts incoming transfers. Most workplace schemes can receive transfers from previous pensions, including SIPPs, but check with the scheme administrator first.

Is the State Pension age the same as the age I can access my SIPP?

No, these are separate ages set by different rules. Your SIPP can normally be accessed from 55, rising to 57 in 2028, while retirement age in the UK for men and women alike currently sits between 66 and 68 depending on date of birth.

How much pension should I have before consolidating into a SIPP?

There’s no fixed minimum pot size that determines whether consolidating makes sense. It helps to assess your retirement savings benchmarks by age against your current total pot before deciding whether consolidating everything into one SIPP is the right move.

Where can I get free guidance before transferring?

Pension Wise, backed by the government and delivered through MoneyHelper, offers free appointments for people aged 50 or over with a UK-based defined contribution pension. It explains the options for taking your pension and how they are usually taxed, but it does not recommend which option you should choose.

 

Disclaimer: This article is for informational purposes only and does not constitute regulated financial advice; always consult an FCA-authorised professional before making pension transfers.