Executive Pension Plans (EPP) &
Small Self Administered Schemes (SSAS)

Defined Contribution schemes - EPP & SSAS

These arrangements offer a flexible and tax efficient way for directors to manage their retirement planning. There are many similarities between these arrangements, the subtle differences are important when ensuring that the correct type of pension is used to meet the needs of the sponsoring company and the individual members.
For example
Individual SSAS schemes normally have fewer than 12 members, all of whom should also be trustees of the scheme; this is not true of EPP

The contributions to these type of pensions are very flexible and not usually a contractual obligation of the sponsoring employer, the level and frequency of payments can be varied to match the profitability of the company. Contributions are allowable as an expense against corporation tax and subject to the local inspector of taxes agreement provided that they are deemed to be wholly and exclusively for the purposes of the trade of the company.

There are wide investment powers available with these type of schemes, the following shows a brief summary of these:

• Stocks and Shares quoted on any recognised exchange
• Unit Trusts, Investment Trusts and Open Ended Investment Companies.
• Deposit accounts.
• Hedge funds.
• Commercial Property.
• Commercial and Residential property funds.
• Government Securities.
• Futures and Options traded through a recognised exchange.
• AIM Companies.
• Traded Endowment plans
• Ground rents.
• Insurance company managed funds.

Additional benefits

• The scheme can “loan back” to the company up to 50% of the fund, subject to strict conditions on the security and purpose of the loan

• The Scheme can purchase shares in the sponsoring company subject to strict limits and criteria (SSAS only)

Disadvantages

These type of arrangement tend to be fairly expensive and time consuming to administer. The responsibilities of the trustees are onerous and consideration should be given to assess if the additional costs and responsibilities of such schemes are justified when facilities of the SSAS or EPP are not being used or likely to be used fully.

If you are an employer or trustee who sponsors an EPP or a SSAS, you may wish to review your arrangement to ensure that they meet your objectives whilst presenting good value.
We can help you answer these questions, we provide a full advisory service for planning your retirement which will take account of your circumstances, attitudes and current planning, providing you with our written summary of current retirement planning.
If you would like to discuss further, please complete the enquiry form (buttons below) and one of our trained advisors will contact you to discuss further. There are no fees for any initial consultation which may be by email, phone or meeting if required. You may incur costs should you decide to buy a particular product and these will be fully explained to you by the advisor before you finally decided to proceed.