Frequently asked questions about how pensions led funding can work for your business.

What can I use a Pension Scheme Loan for?

Any commercial purpose of the company. So, that might range from buying stock or machinery to funding other company projects such as residential property development.

How is it different from other types of funding?

There are no Banks or third party lenders involved. It’s your pension scheme, so you are essentially dealing with yourself. There are no credit checks either – the loan is based on set HM revenue & Customs criteria.

How much control do I have?

You will be able to shape the transaction to suit your needs, though this is subject to HMRC rules. Normally, there will be a Professional Trustee involved in your pension scheme who will help ensure that your pension scheme remains compliant with all those rules.

How much does it cost?

There are two type of cost involved in the pension scheme: establishment costs and annual costs. Those costs will vary depending on the types of transaction that you undertake. We can provide you with an estimate based on what you are looking to do, and those costs can be paid for out of the pension scheme.

How quickly can I access funds?

Setting up a Scheme can take a number of weeks, so if you are planning a transaction it is best to get this underway as soon as possible so that your funding is available when you need it. You need to allow approximately 6 weeks to set up the pension scheme through HMRC, and then a further 2-3 weeks for any pension transfers you are arranging.

Can I buy residential property?

No. Pension Schemes can’t own residential property. They can, however, be involved in the process of getting planning permission on land, and also in part-developments or conversions towards residential property.