SSAS pension advice for company directors

A SSAS is an occupational pension scheme, usually with fewer than twelve members, established by a limited company for its directors and sometimes family members who work in the business.

Its distinguishing feature is what it may do with the money. A SSAS can buy commercial property — including your own trading premises — and can lend back to the sponsoring employer, subject to strict HMRC conditions.

That makes it a genuine planning tool for owner-managed businesses, and a poor fit for almost everyone else. It carries real administrative responsibility, and the members are usually the trustees.

• Loanback to the sponsoring employer. Up to 50% of scheme assets may be lent to your own company, secured as a first charge, at a commercial rate, over no more than five years with equal repayments. Get any of those conditions wrong and it becomes an unauthorised payment with punitive tax charges.
• Hold your trading premises. The company pays commercial rent to the pension rather than a landlord. Rent is deductible for the company and received tax-free by the scheme.
• Pool family members' funds. Several directors' benefits sit in one scheme, which can make a property purchase viable that no single pot could support.
• Employer contributions. Usually deductible against corporation tax, making a SSAS an efficient route for extracting profit.

• It tends to suit established owner-managed companies with meaningful pension funds and a specific purpose in mind — buying premises, or funding growth through a loanback.
• If you simply want a flexible pension with wide investment choice and no administrative burden, a SIPP is usually the better answer.
• Because a SSAS sits at the junction of pensions, corporate tax and trust law, it warrants a specialist. That is exactly the kind of adviser we introduce you to.