The group is anticipating a sharp increase in SSAS business before April 5, 2006 as small business owners convert executive pension plans into SSASs to take advantage of loanback terms.
Small businesses converting executive pension plans which are more than two years old can access 50 per cent of the net assets of the scheme in the form of a loan.
Managing director David Seaton says the group is encouraging financial advisers to discuss this conversion option with clients as he believes the loanback terms are much more favourable now than they will be after A-Day.
He points out that before A-Day, loans are unsecured whereas under the new regime they will be secured with a first charge.
The rollover facility is also less favourable, with just one missed payment allowed to be rolled over twice as opposed to the current flexibility to roll over the whole loan.
Seaton says: “We expect to see an increase in business between now and A-Day as advisers and their clients consider how a SSAS can work for a business while at the same time building a substantial pension fund. Business owners can invest through an SSAS as they see fit and take income from the fund for life.”