Most owner directors of small/medium size businesses see their business as the vehicle to fund their retirement. They retain profit in the business, paying corporation tax each year and when the time comes to retire draw down income on which they pay more tax!
Paying into a pension would be a more tax efficient route to take. But regulated personal pensions provided through IFA networks seem to fail to meet their needs. They see the standard pension option as being restrictive and not meeting the needs of business owners. ‘Why pay company profits into a pension which locks up money for a long period of time when it may be needed in the business?’ is the question they often ask, usually followed by ‘We need to keep our money accessible, just in case.’
This attitude is fully understandable. The need to save for the future is recognised, but from their viewpoint must be balanced against the possible needs of the business as well. And they are prepared to sacrifice tax benefits to achieve this.
So just suppose there was a pension that did meet the needs of you, the business owner. It took advantage of the tax benefits of the company making pension contributions; it provided retirement benefits; and it DID NOT lock the funds away when they were needed to support the needs of the business.
Well strangely enough, such a pension has been available to business owners since 1973! It’s arguably the best kept secret FROM business owners. In our conversations with business owners over 90% of them are unaware that such a pension exists! Within accountants who work with these business owners it’s not much better and IFA’s won’t talk about them. It’s no wonder it’s a best kept secret.
So what is the pension? It’s a Small Self-Administered Scheme – SSAS for short. Amongst other options, it has the ability to lend funds back to the sponsoring employer, purchase commercial property (the rent you pay goes into your pension) AND build a valuable fund for your future needs and create a legacy for future generations.
‘Too good to be true’ I hear your say. The reality though is that it does exist; it’s fully approved by HMRC and it’s aimed specifically to meet the needs of owner directors of limited companies and you’re not taking advantage of it!
If you’ve read this far, I’ll put money on it that you have never heard of a SSAS, yet alone know what it can do for you and your business. Let’s have an informal chat over a coffee and explore how a SSAS might work for you. Email firstname.lastname@example.org or call me on 07834 600024 so we can get a date in the diary for an online meet up.
Let’s make a SSAS pension work for you!