It’s that time of year, when Business Link Magazine invites the region’s business leaders to offer up their predictions for the year ahead.
It has become something of a tradition, given that we’ve been doing this now for over 30 years.
Here we speak to David Santaney from WestBridge Group which provides specialist tax and SSAS administration services to business owners and professional advisers.
Most predict a bleak economic outlook for 2023 with help being sought from any quarter. One area of predicted growth however is within the Small Self-Administered Scheme (SSAS) pension arena.
SSAS has become the forgotten pension product in recent years following the rise in popularity of the better-known Self Invested Personal Pension (SIPP). The SSAS offers all of the same features in that it can acquire the premises from which a business trades (allowing the payment of rent into another pocket of the business owners wealth) but has one key advantage – it can lend money back to the founder employer.
With interest rates on the rise, obtaining or renegotiating borrowing terms from the high street lenders may become problematic. A SSAS can lend up to half of its value back to the business to assist cashflow or fund special projects. The interest rates should be commercial but usually there are no up-front arrangement fees and interest when paid is routed back into the pension fund rather than to a third-party lender.
A SSAS can also acquire the premises from which a business trades. The release of capital to the business might be opportune in the predicted environment and control of the premises is not lost as it becomes an asset of the SSAS.
Unlike SIPPs which are a regulated product of the pension provider, a SSAS is controlled by its trustees, almost always the scheme members themselves. With these features, the re-emergence of SSAS as the preferred pension vehicle of choice for business looks likely.
