Providers have approached HM Revenue & Customs with concerns over the “allocation of growth” feature of Axa Wealth’s family Sipp, Money Marketing understands.
Axa Wealth has been battling delays in setting up new family Sipps as part of its Family Suntrust product, but denies this is connected to the controversial allocation of growth practice.
This allows asset growth to be split between individuals to avoid breaching lifetime allowance limits.
Rival firms say they have been turned away by HMRC when trying to register similar products.
Axa says changes to HMRC’s scheme online registration process have led to “some delays”.
But it says growth allocation is not the problem and that external lawyers confirm the feature as being compliant when it was established and under current rules.
A spokeswoman says: “The allocation of investment growth is just one of a number of features of Family Suntrust and is one that has been available since the product launched in 2008.
“We’ve discussed this particular feature with both HMRC and our external legal specialists, including Queen’s Counsel, in the past and there have been no recent changes to legislation that would impact upon the Family Suntrust pooled fund.”
Rowanmoor also offers a family Sipp product, the Family Pension Trust, but not the growth allocation option.
Head of pensions technical services Robert Graves says: “We’ve had no problem registering schemes at all. The virtues of a family Sipp are strong under the current rules – they are a great way of holding combined assets and passing on death benefits down generations.”
Pensions technical experts have previously said the Government could target arrangements where scheme members were deliberately avoiding the lifetime allowance on contributions.
The Treasury has reduced the generosity of tax relief on pension contributions and is considering scrapping up front relief entirely.
From April 2016 the lifetime allowance will be reduced to £1m – from £1.25m today – while people earning £150,000 or more will see their annual allowance tapered to £10,000.
HMRC declined to comment.