Pension Practitioner
The SSAS Experts

Key Differences


  • Membership

  • Control




  • Regulation


  • Ownership of Investments




  • Investment Choice




  • Loans




  • Unquoted Shares





  • Borrowing

  • Annuity purchase

  • Pension drawdown



  • Contributions





  • Allocation of investments



  • Allocation of contributions


  • Pension Commencement lump sum


  • Death benefits rules




  • Administration











  • Trust Structure

  • Winding Up





  • Bankruptcy










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SSAS


  • No restriction on membership

  • The employer usually acts scheme provider. A business such as a limited company or partnership may be the scheme provider.

  • SSAS regulated by the Pensions Regulator.

  • The investments are registered in the name of the trustees , who will be also the scheme members.
    Requirement for a pensioneer trustee removed from 6/4/06.
  • The investment choice is dictated by the investment decisions made by the member trustees.


  • Yes, up to 50% of the assets of the scheme to an employer. 1st charge security required.

    No limit for unconnected parties
  • Can hold shares in sponsoring employer. May hold shares in unconnected companies, subject to taxable property rules.


  • 50% of the net value of the fund

  • Not compulsory

  • Yes, available via capped drawdown and flexible drawdown.


  • Employer contributions can be paid gross. The SSAS can be registered for relief at source, personal contributions can claim basic rate tax relief, higher marginal rate secured via annual returns.

  • Investments do not need to be allocated amongst the members, as a common trust principle applies.

  • Contributions do not need to be earmarked at outset from the Employer.

  • Where protection does not apply, typically 25% of the value of the fund

  • Possible to provide a lump sum, pension benefits or annuity benefits for your dependants.


  • Is required to provide returns to HMRC.

    Required to provide an annual return to the Pensions Regulator.

    Not required to provide an SMPI statement where all members are trustees.

    Required to provide unaudited accounts for two members plus.

  • Common Trust

  • Non allocated funds can be returned back to the business should trustees and the employer terminate the scheme. Tax charge of 35% applies to the refund back to the employer.

  • The SSAS asset under the Welfare Reform and Pensions Act 1999 does not form part of a bankrupt's estate and therefore cannot be claimed by the Trustee in bankruptcy.

    However, income can be charged against. Non allocated funding rules can provide member trustees a high degree of flexibility with regard to income orders.

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SIPP


  • No restriction on membership.

  • The SIPP provider is traditionally a financial house, such as a bank, building society, insurance company. Trust companies can also act as SIPP provider.

  • SIPP regulated by the FSA


  • The investments are registered in the name of the SIPP trustee company.
    The member may hold sub-trustee status.

  • The investment choice is dictated by the rules applying to the SIPP. For example, some SIPPS permit investment in overseas land whereas others do not.

  • No loans to an employer permitted.
    No limit for unconnected parties.



  • Cannot hold shares in the sponsoring employer. May hold shares in unconnected companies subject to the consent of the SIPP provider and taxable property rules.

  • As with SSAS

  • Not compulsory

  • Yes, via capped drawdown and flexible drawdown.


  • Basic rate tax relief at source only. Higher marginal rate secured via annual returns.




  • Operates on a master trust principle, non-earmarking does not arise.


  • Contributions are earmarked at outset from the Employer.

  • As per SSAS.


  • As per SSAS.




  • Is required to provide returns to HMRC Is not required to provide an annual return to the Pension Regulator. Must provide an annual SMPI statement.








  • Mastertrust

  • No refund of contributions arises.





  • The SIPP asset under the Welfare Reform and Pensions Act 1999 does not form part of a bankrupt's estate and therefore cannot be claimed by the Trustee in bankruptcy.

    Income at vesting date can be charged against. Non allocated funding rules cannot be applied.


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There remains substantial differences between SSAS and SIPP. Download SSAS v SIPP Document (PDF)

Important Note: 

This is provided for information purposes only and does not constitute a recommendation, implied or otherwise. These contents remain the copyright of the LLP. This and all other articles are registered with the Copyright Licensing Agency. We monitor the use or passing off of all our material and take legal action against those found to be in breach of Copyright Laws.

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