Can a SSAS buy residential property?

The tax rules do not forbid it, and the charges that apply make it almost always the wrong move. Residential property is taxable property, and buying it triggers charges on the member, on the scheme, and again every year it is held.

What it costs to get it wrong

40% on the member
The purchase price plus acquisition costs is treated as an unauthorised payment and charged on the member.
A further 15% surcharge
Where unauthorised payments in a twelve month period reach 25% of the member's pension rights, taking the total to 55%.
A scheme sanction charge
Up to 40% on the scheme administrator, which cannot be reduced below 15% of the payment.
An annual charge afterwards
Each year the scheme is taxed on the greater of the actual profits or deemed profits of 10% of the property's value.

What else counts as taxable property

40% on the member, up to 15% more as a surcharge, a charge on the scheme, and a further charge every year it is held.

Related questions

What about a flat above a shop?

Mixed use needs care, and the answer turns on the detail of the title and the use. It is the common case where people assume they are safe and are not.

Can the scheme buy my trading premises?

Commercial property, yes. The company can then pay rent to the scheme, which has to be at a commercial level.

Can it buy a holiday let?

A dwelling is residential property whatever it is used for, so the same charges apply. There are narrow exceptions for certain job-related and institutional accommodation, which rarely help.

Can I buy the property from the scheme later?

A sale to a member, the employer or a connected person has to be at market value. Any difference is an unauthorised payment.

Where this fits

If a property is under offer and you are wondering whether the pension can buy it, ask first. The charges are not recoverable.

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Sunny Bharj

Sunny Bharj

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Tony Springer

Tony Springer

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