Bell appeals to Darling for Sipp property boost

12 March 2009 0:31 am

Bell has also written to Conservative Shadow Chancellor George Osborne on the matter.

The Government was on the brink of allowing Sipps to invest in residential property in 2005 but made a U-turn at the last minute after widespread concerns.

Bell says: "I believe that allowing Sipps to invest in residential property would provide a huge boost to the UK housing market and help bring back confidence to a severely battered sector. The original proposals were ill-conceived and ill-timed but a properly thought out policy will give a much needed boost to the whole economy."

In the letter, Bell proposes a number of restrictions, aimed at avoiding loopholes. He suggests investors should only be allowed to purchase property on a buy-to-let basis from unconnected people and let to unconnected people to ensure an open market rent.

Bell estimates that up to £10bn of Sipp funds would flow into residential property within a year of changing the rules. He has also called on the Government to lower the alternatively secured pension tax on death to 55 per cent from 82 per cent, claiming the current charge is penal while 55 per cent would compensate the Treasury for tax relief granted.

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