How to use a Small Self Administered Scheme
How to use a Small Self Administered Scheme
At Studio 61 Wealth Management we act as an adviser to a few Small Self Administered Schemes, also referred to as a SSAS.
SSAS’s have some features of a personal pension and some features of a corporate pension scheme.
A SSAS is actually a corporate scheme under the UK regulatory regime. The main difference from a standard corporate scheme is that there is no need for member representation on the board of trustees. All the members have rights under the scheme rules.
A SSAS can only have up to 12 members and so is excused from a lot of the regulation that applies to larger corporate pension schemes. A SSAS can be as flexible as a personal pension when it comes to investment strategies.
SASS’s can be particularly useful for small groups of people who want to pool their pension allowances to own or manage assets with significant value. The most frequently used example of this is when company directors use a pension arrangement to purchase a commercial property. The pension can then lease the property to the directors’ company.
All rent payments into the pension can then be made before calculating corporation tax for the company. The members of the scheme can then use the rent payments for further investments with no tax issues or use the income to pay benefits.
SSAS’s also have the capacity to make loans to the sponsoring company. SSAS’s can then be used as a a funding source for a company.
If you are looking for advice on managing or setting up a SSAS please contact us.
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