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Traditionally, SSAS was used by key directors and business owners as a means of building pension funds for themselves in a highly tax efficient way. Following changes in 2006 to how SSAS pensions operate, these schemes are now used widely in business for a variety of pension objectives.
We have been asked whether SSAS can be used as a simple route to meet auto enrollment and whilst in principle this is acceptable, the practical issue that all members should be trustees makes this a less than compelling case. For a SSAS to regarded as a small self administered scheme, there should be less than 12 members in the plan and in addition the members must be unanimous in their investment decisions. Conversely, large self administered schemes have no upper membership limit and will be subject to full Pensions Regulator requirements, this gives an added layer of protection to the plan. Scheme independent audited accounts and internal dispute resolution procedures are exempt for SSAS where all members are trustees, therefore using SSAS as a route to auto-enrollment is not, in our opinion, a good fit.