The future for SSAS.
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The Small Self-Administered Scheme (SSAS) market is old and credible but largely unknown. Too long has this jem been hidden in the shadow of the Self-Invested Personal Pension (SIPP). Many do not truly realise what a SSAS offers.
For going on 35 years SSAS has languished behind SIPP in general popularity, used by only the elect few. One commentator called SSAS the private bank of pensions.
Rule changes by HMRC has unlocked the SSAS for the general market and informed persons ought to know.
Pension Practitioner .com the leading provider elaborated on the new potential for the unlocked SSAS. Pension analysts at the firm confirmed that between persons with family connections, SSAS remains to be better in all regards to SIPP. But now any key employee, property developer, shareholding director of a private company or partnership needs to pay attention.
I asked Pension Practitioner .com to summarize in a word what they basically mean. ‘Control’ was the response. At less cost than a SIPP, many business managers opt for the premium of control SSAS offers.
Pension Practitioner .com SSAS services commentary.
I asked Pension Practitioner .com, what happens if a SSAS provider’s service practitioner fails to deliver? Simply appoint another they said. They, for example, do not impose take-over fees.
What I wanted to get to was the real and practical investment reasons which differentiate SSAS from SIPP. The managers of Pension Practitioner .com responded by first clarifying that assets are held by the members as trustees.
The other main advantage is that SSAS operate on a ‘non-allocated’ and pooled investment approach. This means that not only are assets jointly owned, but this allows for a fluid transfer of assets between generations as retired member’s fund decline and newer members fund builds up. This is especially beneficial for situations where members are related or work for the same company.
The last important difference said Pension Practitioner .com, after cost is that of control. The real choice one is making is ‘ do I want to own the pension scheme, (SSAS) or should I piggyback on someone else’s, (SIPP). The former is more pro-active and involves more paperwork. But with a designated pension practitioner this issue falls away.
In summary, rather than debate the merits of SSAS over SIPPs. The definitive proof is obvious. Gone now are the reasons for SIPP, like, different funding, investing, borrowing and benefit rules. The managers of Pension Practitioner .com made abundantly clear that SSAS are of credit to their owners, but as a pension fund they do need planning and attention. This brings in the need for a practitioner to consult, to accept the obligation and duties of administration. To maintain accounting records and prepare annual accounts. To complete and submit HMRC scheme returns, event reports and quarterly accounts for tax returns.
Pension Practitioner .com finished by saying that, “SSAS are not a mass-market product. But for those clients who take up this valuable instrument, most always question why they never opened a SSAS earlier.”
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