A small self-administered pension scheme (SSAS) is an employer-sponsored workplace pension that can provide retirement benefits for up to 12 people.
A SSAS is run by its trustees, who may often be the members of the scheme.
The scheme is open to the following:
- company directors
- employees (you can restrict it to certain workers)
- family members.
All of the assets of the SSAS are held in the name of the trustees so there are no ‘individual pots’ for each member.
Contributions can be made to the SSAS by the members and/or the employer. Each receives tax relief on contributions, subject to certain conditions.
Pensions can be drawn from the age of 55.
The assets in SSAS can be used in ways that aren’t generally available for many other types of pension.
- buying the company’s trading premises and leasing them back to the company
- lending money to the company
- purchasing company shares.
The scheme can also borrow money for investment purposes. This could include raising a mortgage to buy the company’s premises. The mortgage repayments may then be covered (totally or in part) by the rental income that the company pays the SASS.
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Pension eligibility depends on personal circumstances. Tax rules and allowances are not guaranteed and may change in the future. Pension benefits cannot normally be taken until age 55. The value of investments can fall as well as rise and you may not get back the amount you originally invested.