£10,000 to invest in a SIPP? These stocks could send it surging in 2026

A Self-Invested Personal Pension (SIPP) is one of the most powerful long-term wealth-building tools available to UK investors. The appeal lies in the combination of generous tax relief, broad investment freedom, and the ability to compound returns over decades in a highly tax-efficient environment.

Contributions benefit from income tax relief at the investorâs marginal rate, while investments held within a SIPP are sheltered from both capital gains tax and dividend tax. Even children get this tax relief if they’ve got a SIPP — you can open one from brith.

Importantly, a SIPP also offers far greater control than most workplace pensions. Investors are not limited to a narrow range of funds but can instead build a portfolio spanning individual shares, investment trusts, ETFs, and bonds.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Where to invest?

So, let’s imagine you have Â£10,000 to invest in a SIPP for next year. For starters, if you put Â£10,000 in a SIPP, you’ll automatically receive around Â£2,500 in the form of tax relief. You’ll receive more if you’re a higher rate tax payer.

How this Â£12,500 is divided between investments depends on the total size of your portfolio and how much your brokerage charges for each trade.

But here’s a few stocks to consider for 2026.

One stock that ticks a lot of boxes in TBC Group (LSE:TBCG), a Georgian bank with a subsidiary in Uzbekistan.

It’s got a forward dividend yield around 6%. It trades at 5.1 times forward earnings making it cheaper than the vast majority of global banks. And, forecasted earnings growth is around 11% on average over the next two years.

The business looks vastly undervalued according to these figures. Analysts agree with the share price target around 35% above the current price.

It’s also pretty strong when it comes to profitability grades. The return on equity ratio is around 24.8%. That’s far above many banks in the UK, but also below its Georgian peer Lion Finance — the issue with Lion Finance is it’s more expensive.

The risks? Well, its Uzbek operations have dragged on earnings this year after regulatory upheaval demanded a strategy change. It’s also true that Georgia is still experiencing political challenges.

However, it certainly looks like a stock to consider for 2026.

Another undervalued banking group is Arbuthnot (LSE:ARBB). Analysts suggest it could be undervalued by as much as 79%. It trades at 8.2 times forward earnings with a 6.1% forward dividend yield.

Earnings will take a backward step in FY2025 due to falling interest rates, but long-term prospects remain positive. It serves high-wealth clientele and inflows remain strong. Looking longer term, an inevitable change of government might bring more high-wealth clients back to the UK.

Risks include liquidity. It’s much smaller company even than TBC and the spread between the buying and selling price is wide.

Nonetheless, I think it is certainly worth considering.

The post Â£10,000 to invest in a SIPP? These stocks could send it surging in 2026 appeared first on The Motley Fool UK.

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James Fox has positions in Arbuthnot Banking Group Plc and TBC Bank. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.