SSAS rules
and regulations

What kind of regulations are there for a SSAS?

One of the main attractions of a Small Self-Administered Scheme (SSAS) is that members have much more control over their pensions than they do with traditional pensions. But does this control come at the expense of security? Not at all. SSAS regulation must be adhered to. A SSAS is overseen by The Pensions Regulator AND must be registered with HMRC and abide by HMRC rules.

Retirement planning and family investment concept

General SSAS rules

A company director can have a SSAS. As SSAS can have up to 11 members in total. A SSAS is run by its members, who are trustees of SSAS. The scheme and its paperwork is managed by the Scheme Administrator, who can be a member of the scheme. Whilst it is not a legal requirement, it is advisable to employ a Professional Trustee, who is able to ensure the scheme abides by HMRC rules and the regulations set by The Pensions Regulator.

Within HMRC rules, a SSAS can invest in a range of assets, including commercial property or hands-free property investments. The SSAS scheme can provide commercial loans so could provide a loan to the company. This loan can be used to purchase assets, for example a building such as the company premises, or for any other valid business purpose. A SSAS can borrow money, via a mortgage for example, for investment purposes.

Company Directors pooling their pensions via a small self-administered scheme pension

A SSAS Is a Trust which must adhere to SSAS regulation

We are often asked, is there a SSAS pensions regulator, how are SSAS pensions regulated, and who makes SSAS pension rules. To a certain extent, a SSAS is self-regulating. It’s a trust, which means that it is run by trustees for the benefit of its members. In practice, all members of a SSAS are trustees of the SSAS scheme.
• Any member of a SSAS can be a trustee.
• A trustee does not have to be a member of the SSAS.
In the majority of cases, an SSAS is run by the members for the members, meaning there’s no outside influence from trustees who are not members of the scheme. The rules of the scheme are set by HMRC.

Two business owners looking at SSAS pension regulations

Why Might You Not Want to Be a Trustee?

Being a trustee comes with certain legal responsibilities. For instance, it is the responsibility of a trustee to ensure that any tax owed is paid to HMRC. If any member of the SSAS doesn’t want this responsibility, they can choose not to be a trustee.
However, it is worth considering the pros and cons of having members who are not trustees. Trustees have to demonstrate that they are acting in the best interest of all members of the SSAS. If all members of the SSAS are also trustees, this process is straightforward. If there are any non-trustee members, this can become complex.

Professional Trustees

It is common practice to appoint a professional trustee to your SSAS. A professional trustee is tasked with the day-to-day management of the SSAS and it is a legally responsible position. This person should be experienced and possess a good understanding of pensions, tax laws and investment.
It is not a legal requirement to appoint a professional trustee (as of August 2018), but lawmakers may decide to change this.
TLPI strongly advise you appoint a professional trustee and will ensure one is chosen that is right for your specific situation and goals, as part of our SSAS service.  Give us a call on 01235 426666 to discuss your options.

HM Revenue & Customs Logo

Registering with HMRC

One advantage of a SSAS is that it can be exempt from certain taxes, including Capital Gains tax. If you want to invest in property, it can often be more lucrative to invest in property via a SSAS.

To qualify for tax-exempt status, a SSAS must be registered with HMRC. Each SSAS will also be granted a Pension Scheme Tax Reference (PSTR) number. It is usually prudent to only start contributing to a SSAS (or make transfers from an existing pension) once you are registered. If you make contributions or transfers before being registered with HMRC, the contributions will not qualify for tax relief and transfers will be unauthorised.

You should also know whether any members of your SSAS hold a certificate of protection or a HMRC protection reference number, and if the Money Purchase Annual Allowance applies to them.

HMRC rules
The Pensions Regulator logo

The Pensions Regulator

Lastly, workplace pensions, including SSAS, are regulated by the Pensions Regulator (TPR), which is sponsored by the Department of Work and Pensions. TPR is responsible for making sure all employers set up their employees with a pension and that employee pensions are protected.

As a SSAS is a workplace pension, each SSAS must be registered with TPR if there is at least one employee enrolled. If the SSAS is made up of just one member, such as the employer, then it does not need to be registered with TPR. The Pensions Regulator can investigate and prosecute those who break the law.

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