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Pensions property specialists

This website provides information about the property services we provide through Embark Pensions.

Please note it is primarily for use by Advisers and customers in conjunction with their Adviser. The information and opinions provided are for guidance only and are not intended as investment advice. We recommend that you seek advice from a recognised investment professional before making any decision to invest in property or one of our products.

Property investment is only available through our Full SIPP. Buying commercial property via a pension can be a tax-efficient way to inject cash into a business and provide regular income for the scheme in the form of rent.

Our property team has over twenty years experience in buying, administering, and selling commercial properties in pension plans to ensure transactions are carried out in accordance with pension regulations and minimise any associated risks. Whilst the pension rules for investing can seem complex, we are here to assist you and your adviser through the process.

Investing in commercial property

Buying commercial property via a pension scheme can be a tax-efficient way to inject cash into a business and provide regular income in the form of rent. It is also possible for the pension to borrow up to 50% of the net value of the scheme to assist with the purchase provided the rent is sufficient to cover loan repayments. Those planning to purchase property through their pension, should consider the following:

Prior to purchasing an acceptable property investment an independent valuation is required and must be provided by a RICS Surveyor and addressed to the Trustees.

It is possible to borrow up to 50% of the net value of the assets held within the pension scheme. You are able to borrow from most high street lenders, although all borrowing documentation must be agreed by us prior to a loan being taken out.

Adequate insurance cover through our Block Policy is preferable and must include owners liability insurance of at least £5m.

Rent must be paid when it falls due and subject to regular rent reviews.

We have a panel of solicitors for you to choose from, please find their details here.

We do not provide property management services. However, it is the responsibility of the pension members to put appropriate property management arrangements in place or the responsibility for property management will fall to the pension members themselves.

  • Taxable property including residential (dwelling houses), holiday apartments, beach huts, and caravans.
  • Residential Institutions
  • Secure Residential Institutions
  • Property that benefits from an aggregated income such as hotel rooms and storage pods.
  • Types of property where we are advised that there is no re-sale market, or we foresee management difficulties.
  • Properties with existing tenants with known historic rent arrears or other material breaches of covenant.
  • Any property where insurance is unavailable or inadequate in the insurance market for any reason, e.g. combustible composite panels, waste transfer and recycling sites, historic flooding, subsidence.
  • Land purchased from a third party which adjoins a member’s personal residence where the member or connected party may gain a non-relevant benefit, e.g. being purchased to preserve a view from their house or to stop someone else building, or to increase the value of their personal residence.
  • Properties at auction.
  • Properties with known unremediated environmental issues.
  • Freehold properties where part of the building comprises long leasehold residential properties even if let to third parties with nominal ground rent.
  • Land for residential development, garden land, etc.
  • Certain other residential institutions, e.g. student accommodation, care homes, etc.

How we work

Investing in commercial property can be complex and time consuming. Our aim for each transaction is to make the process as straightforward and efficient as possible, and we take over the end to end process and deal with all parties so that you don’t have to.

We prefer to work with our panel solicitors who have extensive knowledge of transactions within pensions and know the way we and HMRC work. We have pre-agreed reports and lease documentation in place to simplify the conveyancing process and have negotiated a schedule of fees for each type of transaction. You may still use a solicitor of your choice but this involves more work for us and we reserve the right to charge higher fees.

We will review any proposals to establish whether they are pension compliant and where possible, to avoid incurring unnecessary fees if a transaction cannot go ahead.

We also have an experienced VAT team who will deal with any VAT registrations and VAT returns required.

Something to keep in mind

Commercial property can be a less liquid investment and disposal of it will take longer than exchange traded investments. You should take this into account when considering a property investment and the need for liquid assets to pay retirement benefits as and when they fall due or additionally, during times when a property is unlet as insurance and business rates will still be payable.

Why us?

  • Dedicated, experienced property and VAT team
  • Well versed in the intricacies of holding property within a pension scheme
  • We oversee a portfolio of c3,000 UK properties
  • We specialise in dealing with all administrative aspects of the life cycle of a property investment from purchase to sale
  • Competitive block insurance cover arranged via our broker, Hettle Andrews

Contact our Property team

Contact our Property team on 01204 803 500 or email us.