Allison Chambers, director at SSAS Solutions, discusses how a Small Self-Administered pension Scheme could boost your retirement income.
A common phrase six or seven years ago but historic turmoil in the property market has seen values reduce significantly along with rental yields. Wouldn’t it be great if you could get a helping hand from the exchequer in the form of tax relief? It’s actually called a pension scheme...
A Small Self-Administered pension Scheme (SSAS) enables the business owner to own commercial property and land (even land with residential planning attaching). It is also possible to lend money from your SSAS back to your business, subject to meeting HMRC’s criteria.
The main benefit to owning commercial property/land in a pension fund is the generous tax advantages attaching:
Use of tax relieved money to fund the purchase (i.e. tax relief received on historic and/or new pension contributions used to finance the purchase)
No income tax on the rental income paid to the pension fund and, once the income is within the fund, it will benefit from tax-free growth
Tax relief for the business leasing the property, on any rental payments paid into the SSAS
No Capital Gains Tax on any subsequent disposal of the property
25 per cent of the pension fund available as a tax-free lump sum when payment of pension benefits commences
All pension benefits paid tax-free to nominated beneficiaries on death before age 75 (i.e. no Inheritance Tax on the member’s fund)
In the SSAS arrangement, assets are held in a trust and are completely distinct and separate from the company's/member’s personal assets, therefore providing worthwhile protection from any potential creditors
Complete flexibility in relation to disposal of the property investment – e.g. sell back to the company or the members personally (on an arm’s length basis)
Our independent SSAS offering enables the business owner to operate their own pension fund without the requirement for a third party trustee or insurance company, thereby enabling them to have the maximum control and flexibility permitted within the tax legislation and HMRC rules. For more information on the use of a SSAS in conjunction with your business then please contact us on 02890 376970 or email firstname.lastname@example.org