SSAS Pension or SIPP?

Although SSAS and SIPP pensions share several similarities, they differ when it comes to their structure and who they will benefit the most. Let us look at SSAS vs SIPP.

What is a SSAS Pension?

A SSAS is an occupational pension scheme which is usually set up by company directors. In most cases, directors want more control over investment decisions relating to their pensions and even more so if they plan to use the pension to invest in their business. The SSAS was created to give business owners more control diversify the range of fund investments allowed. A SSAS is allowed to invite up to 11 scheme members, who can be other employees or family. Each member becomes a trustee which is a requirement under the Pensions Act 1995.  Members are joint trustees of the SSAS scheme.

The key features of a SSAS are as follows:

    • It is an occupational pension scheme

    • Members are usually directors or employees of the sponsoring employer

    • Every member has a notional share of the funds, including non-insured assets such as property and Open Ended Investment Companies (OEIC), and insured assets, like Trustee Investment Plans

    • There is a limit of 12 members.

    • A SSAS is regulated by The Pensions Regulator and HMRC.
What Is a SIPP?

A SIPP (Self Invested Personal Pension) is a personal pension plan which is usually set up by an insurance company or a SIPP specialist. In this case, a member has greater control over the investments but unlike with a SSAS, doesn’t have to be a trustee.

Anyone can take out a SIPP as long as they meet the eligibility criteria which, due to the higher costs involved in running a SIPP, is usually based on a minimum fund size.

Additional features of a SIPP include:

  • A SIPP is a personal pension plan

  • There is the option to invest in non-insured assets, such as property and OEICs as well as insured assets, like a trustee investment plan

  • The employer of a SIPP member can contribute to their pension plan and may operate payroll deduction on their behalf.

SSAS Pension or SIPP?

So, SSAS vs SIPP, SIPP vs SSAS, which pension scheme is the best? Well that depends entirely on who the members are and how much involvement they want in running the scheme. Personal preference comes into play as much as anything else, as well as the objectives you have in mind. Both pensions must abide by HMRC rules to ensure they do not incur tax charges. Both SIPP and SSAS still enjoy the same benefits and tax relief as traditional pensions. It is always advisable to speak to your financial advisor or accountant when looking to transfer your pensions to a SIPP or a SSAS.

A SSAS is appropriate for you if…

  • Your individual or combined pension fund exceeds £75,000

  • You want to pool your pension fund alongside your spouse, family members or business partner

  • You’d like the option to lend money from your pension back to your company

  • You want to manage your pension fund with a more entrepreneurial approach in mind

  • You would like to purchase commercial property

  • You are looking for professional pension advice

  • You want more flexibility and control when dealing with pension investments

  • You would like to have flexibility in terms of drawing benefits when you’re retired

  • Alternative sources of income are available at retirement.

A SIPP is appropriate for you if…

  • Your pension fund is more than £75,000

  • You are seeking bespoke financial advice

  • You are willing to pay a higher level of charges (a SIPP tends to be more expensive than a “standard” pension)

  • You want more control over your pension investments in the stock market

  • You want flexibility in drawing benefits when you’re retired

  • Alternative sources of income are available at retirement.

What our customers say...

5/5
  • An excellent service from Khaleda who took us through the process of setting up our SASS pension. We were fully advised on the whole process and kept up to date regularly with all questions being answered fully. We would highly recommend using Khaleda who we can’t fault. Brilliant

    Jessett Simon Daisy Avatar
    Jessett Simon Daisy
    15/01/21
  • I’ve been working with The Landlord’s Pension this year to sort out historically messy pension arrangements and take control by creating a Family SSAS. Chris Brown has been an absolute pleasure to deal with, friendly professional advice all the way through. Thanks!

    Ray Georgeson Avatar
    Ray Georgeson
    03/12/20
  • I cannot recommend Lewis Jones from the Landlord’s Pension highly enough. His professionalism and knowledge of SSAS’s has been outstanding. He has guided me through the end to end process of setting up a SSAS to transfer my Pension into and has never complained when I’ve sent numerous emails with... Read more

    Lissa Lowrie Avatar
    Lissa Lowrie
    10/11/20
  • Highly recommend The Landlords Pension for setting up a SSAS pension. Many Thanks to Liam, Michelle, Teresa and the team for their support throughout and making it an easy process. Looking forward to our working relationship with future investments.

    Matthew Martin Avatar
    Matthew Martin
    16/07/20
  • Many thanks to Dan,Michelle and Teresa in helping me setup the SASS very supportive throughout the whole process
    Always happy to answers any questions and I look forward to working with them
    I couldn’t have done all this without The Landlords Pension
    Thanks
    Angela Woods

    Angela Woods Avatar
    Angela Woods
    23/06/20

The Landlord’s Pension is an expert in this niche sector of financial planning and have been helping clients to invest in property since 2004