Investing in a Property Using a SIPP
Certain properties are suitable for SIPP investment so property investors may now be able to use their personal pensions to invest in property via a SIPP. A SIPP is a Self Invested Personal Pension for which the person investing for retirement decides what their pension fund is invested in.
Traditionally pensions are managed be a pension fund manager who will decide where to invest the clients’ funds. Investing via a SIPP can give the investor the flexibility to manage their own fund by choosing their investments.
The SIPP provides a wrapper and enables the holder to have a number of different investments to take as pension benefits when they retire. They may have higher charges than other personal pensions or stakeholder pensions. As with any pension fund, the investor cannot take money from the fund until age 55.
If you are considering investing in a property using a SIPP here are some typical questions and answers to help you:
What type of investment can be included in a SIPP?
A variety of investments can be held within a SIPP, for example, commercial property, Government securities, stocks and shares and unit trusts.
Why Harlequinn properties are considered suitable for SIPP investment?
These properties are part of a hotel resort therefore the property investment is classed as a commercial purchase under HMRC Guidelines.
Are there any exclusions when purchasing via a SIPP?
The property investor is not able to utilise the property for personal gain and is therefore not entitled to any free usage of the property.
Can I arrange a SIPP through Ward & Co?
No. Self Invested Personal Pensions are regulated by the Financial Services Authority under the Financial Services and Markets Act 2000. Ward & Co do not offer advice on SIPPs direct. However, we will introduce all interested clients to a Financial Services Authority authorised firm for this purpose. Ward & Co is not authorised by the Financial Services Authority.
Where can I get advice on a SIPP?
Advice on a SIPP must be sought from a pension specialist working for a firm authorised and regulated by the Financial Services Authority. An advisers’ registration can be checked by visiting the FSA
