SSAS vs SIPP for Commercial Property

A SIPP and a SSAS can both hold commercial property, but they work differently. Business owners often prefer a SSAS for the extra control and the loanback.

The core difference

• A SIPP is a personal pension. Each member has their own scheme, though several SIPPs can jointly own a property.
• A SSAS is a small self-administered scheme, usually set up by a company for its directors. Members are typically trustees, giving them more direct control over the scheme's assets.

The loanback

The stand-out SSAS feature is the loanback: a SSAS can lend money back to the sponsoring employer, generally up to 50% of the scheme's net assets, secured by a first charge, at a commercial rate of interest and over a set term. A SIPP cannot make a loan to a member or connected party. For a trading business, the loanback can be a useful source of funding.

Which suits you

• SSAS: business owners and directors who want control, the loanback, and to pool family or business funds. More administration and trustee responsibility.
• SIPP: simpler, individual, and well suited where one person is buying their premises through their own pension.

Advice

Both are regulated pension arrangements with real complexity. Take advice from a regulated adviser and a scheme administrator on which fits your circumstances. See SIPP commercial property.

What is the main difference between a SSAS and a SIPP?

A SIPP is a personal pension; a SSAS is an occupational scheme, usually for company directors, giving more direct control. A SSAS can also make a loanback to the sponsoring employer.

Can a SIPP lend money to my business?

No. A SIPP cannot make a loan to a member or connected party. That loanback feature is a SSAS.