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IFA launches Sipps with property deal

IFA Central Financial Planning is offering a new service aimed at giving its pension customers access to commercial property investment through their pension fund.

The Property Through Pensions service is aimed at business owners seeking to buy their own business premises and private investors who are looking for exposure to commercial property as an alternative pension investment to equities.

Property Through Pensions allows investment in a property free of capital gains tax, corporation tax and income tax through a Sipp.

Central Financial Planning says a business owner with profits of £250,000 seeking to buy a property worth £150,000 could save £82,900 in tax.

The company will provide advice on the best choice of pension arrangement, arrange any lending requirements and co-ordinate the purchase of the property through the pension scheme.

To qualify for a Sipp, the property must be commercial or have change of use from residential to commercial approved and must not be bought from a connected party.

The Inland Revenue will allow the Sipp to borrow up to 75 per cent of the property value.

The firm charges a 0.5 per cent fee to join Property Through Pensions, with a minimum £750 and maximum £3,000 fee, and will offset any commission received.

Director Ian Smith says: “In the last year, we have seen many more business owners interested in buying their own property using their pension.

“Not only does this have significant tax savings but with their own firm then paying rent for the property, the business owner will see growth to their own pension.”

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