Pensions are often treated like a “later problem”. But for UK directors, pensions can be one of the most tax-efficient tools available right now — not just for retirement, but for extracting profits, investing in assets, and even strengthening the business.
Two pension structures come up most in director planning:
- SSAS pension scheme (Small Self-Administered Scheme)
- SIPP (Self-Invested Personal Pension)
Both can reduce tax, both can be used to invest, and both sit within the same broad UK pension tax framework. But they behave very differently in real life, especially when you’re a director/shareholder running a limited company.
In this guide, we’ll break down:
- What a SSAS pension scheme is and how it works
- How it compares to a SIPP
- Where the “up to £15,000 annual saving” idea comes from
- Whether you can buy commercial property through either scheme
- How fees work and what to expect
- Which providers offer SSAS setup and administration services in the UK
- How to choose the right provider and compare products
- How to transfer existing pensions into a SSAS or SIPP
- Which scheme is better for business owners and in what situations
Important note: This article is general information, not personalised advice. Pension planning should be done with a regulated adviser and your accountant, especially where property, loans, and business-connected investments are involved.
Why Directors Use Pensions for Tax Planning (Not Just Retirement)
A director has three main ways to extract value from a company:
- Salary
- Dividends
- Employer pension contributions
Salary and dividends can be effective, but they are often tax-heavy once you move beyond basic thresholds. Pension contributions, especially employer contributions, can be structured in a way that is frequently more efficient.
For many owner-managed businesses, pensions become a “third route”:
- The company contributes gross
- Corporation tax can reduce
- No employer NIC (in most cases)
- The pension grows in a tax-privileged environment
This is where a SSAS pension scheme can become extremely attractive, because it can be designed specifically for directors and can allow business-related strategies not available in standard pensions.
Planning pensions alongside tax, dividends, and cash flow can unlock significant long-term savings, but the structure matters.
If you’re a director or shareholder and want to understand whether a SSAS pension scheme or SIPP fits your business, you may benefit from a short, no-obligation strategy discussion.
Book a free pension and tax planning call with AccounTax Zone.
What Is a SSAS Pension Scheme?
A SSAS pension scheme (Small Self-Administered Scheme) is a type of occupational defined contribution pension set up by a limited company (or partnership in some cases). It is usually created for a small group of members, commonly:
- Business owners
- Directors
- Key senior employees
- Family members working in the business
A SSAS pension scheme typically allows up to 11 members.
The key feature that differentiates it from a SIPP is governance: Members are usually trustees, meaning they control decision-making and are responsible for how the scheme is run.
The “SSAS Trustee” Element Matters
In most retail pensions, you invest but you don’t govern the pension structure itself. In a SSAS, trustees are actively involved in:
- Approving investments
- Ensuring rules are followed
- Authorising payments
- Making decisions that affect all members
That’s why SSAS schemes are powerful, but also why they require careful administration.
How Does a SSAS Pension Scheme Work?
Think of a SSAS as a pension “container” set up by the company. Money goes in through contributions (and sometimes transfers), and the trustees decide how to invest that money within HMRC rules.
Step-by-Step: The SSAS Structure
- Company establishes the scheme (with an administrator and legal trust deed)
- Scheme is registered and governed as an occupational pension
- Members join and are typically appointed as trustees
- Contributions are made (usually employer contributions)
- SSAS invests in permitted assets
- At retirement, members take benefits (tax-free lump sum + income options)
Who Pays Into a SSAS Pension Scheme?
A SSAS can receive money from:
- Employer contributions (often the main funding route)
- Employee/member contributions (optional)
- Transfers from existing pensions (common)
Because the scheme is employer-based, the business can make significant contributions as part of remuneration planning, subject to rules like
- Annual allowance (and any carry-forward)
- Wholly and exclusively test for corporation tax relief
- Overall reasonableness and remuneration structure
What Is a SIPP?
A SIPP (Self-Invested Personal Pension) is a personal pension designed for individuals. It is not tied to a specific employer.
It offers:
- Tax relief on contributions (via relief at source for personal contributions)
- A broad investment range (depending on the provider)
- Usually strong online platforms
- Flexibility in how you invest
SIPPs can still be great for directors, but they generally don’t offer the same level of business integration and trustee control as a SSAS pension scheme.
SSAS Pension Scheme vs SIPP: The Key Differences
Here’s the director-friendly comparison:
| Feature | SSAS Pension Scheme | SIPP |
| Type | Occupational pension | Personal pension |
| Who sets it up | Limited company | Individual |
| Members | Up to 11 | Usually 1 |
| Trustees | Members often trustees | Provider is typically trustee |
| Business link | Strong | Weak/none |
| Lending to the business | Possible (strict rules) | Not allowed |
| Commercial property | Yes | Yes (many providers) |
| Admin responsibility | Higher | Lower |
| Best use case | Directors wanting flexibility + business/property strategies | Individuals wanting easy investing + strong platforms |
Not sure which structure fits your business?
On paper, SIPPs and SSAS pension schemes can look similar. In practice, the right choice depends on profit levels, director remuneration, property plans, and long-term exit goals.
Request a personalised SSAS vs SIPP comparison for your business.
How Directors Save Up to £15,000 Annually With SSAS or SIPP
The “£15,000” savings headline usually reflects how pension contributions can reduce tax compared to taking the same money as salary or dividends.
A Simple Director Example
Assume a company has £60,000 of profit available and the director wants to extract value.
Option A: Pay £60,000 as extra salary
- Company pays employer NIC (depending on thresholds)
- Director pays income tax + employee NIC
- Total tax leakage can be significant
Option B: Pay £60,000 as dividends
- Company pays corporation tax first
- Director pays dividend tax on extraction
- Still often tax-heavy above thresholds
Option C: Pay £60,000 as employer pension contribution
- Paid gross into pension
- Company may get corporation tax relief (subject to conditions)
- No income tax and NIC at the point of contribution
- Pension grows tax-efficiently
In many director scenarios, the combined saving (vs salary or dividends) can reach five figures annually, and where multiple directors contribute, the total annual savings can scale quickly.
The exact saving depends on profits, tax bands, corporation tax rate, salary structure, and whether annual allowance/carry-forward applies.
What Are the Tax Benefits of Using a SSAS Pension Scheme for Business Owners?
A SSAS pension scheme has the “standard” pension tax benefits, plus business-owner advantages.
1) Corporation Tax Relief on Employer Contributions
Employer contributions are typically treated as an allowable expense if structured correctly, reducing taxable profits.
2) No Income Tax and CGT on Growth
Investments inside a registered pension generally grow:
- Without UK income tax on investment returns
- Without UK capital gains tax on disposals
3) Tax-Free Lump Sum (Usually Up to 25%)
At retirement, members can typically take up to 25% tax-free (subject to allowances).
4) Estate Planning Benefits
Pension funds are usually outside the estate for inheritance tax purposes, and death benefits can be efficient (rules vary by age and circumstances).
5) Business-Focused Uses (SSAS Advantage)
A SSAS can, in the right structure:
- Buy commercial property used by the business
- Lease it back to the company
- Potentially lend to the company (strictly regulated)
- Invest in certain employer-related assets (subject to limits)
Can I Invest in Commercial Property Through My SSAS Pension Scheme?
Yes, and this is one of the biggest practical reasons directors choose a SSAS pension scheme.
What Type of Property Can a SSAS Buy?
Typically:
- Offices
- Warehouses
- Retail units
- Industrial premises
- Mixed-use commercial property (with care)
A SSAS cannot usually invest in:
- Residential property
- Holiday lets structured as residential
- “Tangible moveable property” investments that breach taxable property rules
How the SSAS Property Strategy Works
- SSAS buys a commercial building
- Company becomes the tenant
- Company pays market rent to SSAS
- Rent goes into the pension (tax-efficient environment)
- Asset value growth sits inside pension wrapper
This can be very attractive because it turns a business cost (rent) into a long-term retirement asset.
Can a SSAS Borrow to Buy Property?
Often yes, within HMRC borrowing limits (commonly structured through a mortgage). The borrowing rules must be followed carefully and providers will normally guide this.
Thinking about buying your business premises through a SSAS pension scheme?
This can be highly tax-efficient, but only if structured correctly around VAT, leases, borrowing limits, and connected-party rules.
We regularly help directors assess whether purchasing commercial property via a SSAS or SIPP makes sense for their specific situation.
Speak to AccounTax Zone before committing to a property purchase.
Can I Invest in Commercial Property Through a SSAS or SIPP?
Yes, both can potentially hold commercial property.
However, the practical difference is:
- SSAS is often used to buy premises for the business and lease it back
- SIPP can buy commercial property too, but the structure varies by provider and may come with more platform limitations and additional costs
If your goal is “buy the business premises through the pension and pay rent back into it”, both can work, but SSAS is often the more “business-owner designed” route.
Are There Any Restrictions on Investments in a SIPP Compared to a SSAS?
Both are subject to pension tax rules, but real-life restrictions often differ because of how each scheme is administered.
Common SIPP Restrictions
Many SIPP providers restrict:
- Complex/unlisted investments
- Certain overseas assets
- Business-connected investments
- Loans (especially to connected parties)
Even where something is technically possible under HMRC rules, the provider may simply not allow it.
Common SSAS Flexibility
A SSAS pension scheme often has more flexibility because:
- Trustees have decision control
- Specialist administrators support wider assets
- Schemes are often set up specifically for business owners
But with flexibility comes responsibility, trustees must ensure compliance.
How Does Tax Relief Differ Between SIPPs and SSASs?
This is an important distinction.
SIPP Tax Relief (Personal Contributions)
Personal contributions into a SIPP usually receive:
- Basic rate tax relief added automatically (relief at source)
- Higher/additional rate relief claimed through self-assessment (where applicable)
SSAS Tax Relief (Employer Contributions)
Employer contributions into a SSAS:
- Are paid gross
- Typically reduce corporation tax if allowable
- Are generally not based on “earnings” in the same way personal contributions are (but still subject to allowances and reasonableness)
For directors with strong profits, employer contributions (common in SSAS planning) can often be the more powerful lever.
Steps to Open an SSAS for My Small Business Pension Scheme
Setting up a SSAS pension scheme is not difficult, but it must be done properly.
Typical SSAS Setup Process
- Confirm suitability
- Is the business profitable?
- Is the pot likely to be large enough to justify fees?
- Are trustees comfortable with responsibilities?
- Choose members
- Usually directors and key employees
- Commonly family members working in the business
- Appoint administrator and trustee structure
- SSAS administrator handles reporting, compliance, scheme governance support
- Some include a professional trustee option
- Create scheme documentation
- Trust deed, scheme rules, member documentation
- Register the SSAS
- HMRC registration
- The Pensions Regulator registration
- Open trustee bank account
- Used for contributions, investments, property transactions
- Transfer existing pensions (optional)
- Consolidate previous pensions into SSAS where appropriate
- Start contributions and investment strategy
- Decide on investment plan, property goals, timelines, risk controls
Are There Online Platforms for Managing SSAS Pension Schemes?
Yes, many SSAS administrators now offer:
- Online portals
- Secure messaging
- Document vaults
- Visibility of contributions and investments
- Reporting dashboards
However, SIPPs usually have more “retail investment platform” style dashboards with live fund dealing and charts.
So the best question is:
- Do you need an investment trading platform (SIPP-style)?
- Or do you need a scheme governance and asset oversight portal (SSAS-style)?
Top-Rated Platforms for Managing SIPPs and SSASs Online
This varies by what you define as “top”:
- Lowest cost?
- Best UX?
- Best investment range?
- Best property handling?
- Best business-owner flexibility?
Typically:
- SIPPs lead on digital experience and DIY investment tools
- SSAS portals focus on governance, documentation, bank visibility, and trustee controls
For directors who mainly want property + long-term planning, SSAS online tools are often “enough”. For directors who actively trade funds/shares, SIPPs often win.
What Fees Are Associated With SSAS Pension Schemes From Different Providers?
Fees vary widely because SSAS services can include different levels of support.
Common SSAS Fee Categories
- Setup fee
- Annual administration fee
- Investment transaction fees
- Commercial property fees (purchase, lease, VAT/admin, rent reviews)
- Borrowing/mortgage admin fees
- Loan-back admin fees (if used)
- Professional trustee fees (optional)
Typical Real-World SSAS Cost Ranges (Indicative)
- Setup: £1,500–£4,000
- Annual admin: £1,200–£3,500+
- Property transaction support: can add several thousand depending on complexity
Many SSAS providers use flat fees, which can become cost-effective at higher pot sizes.
SSAS fees vary widely, and cheaper isn’t always better.
We often review SSAS and SIPP cost structures for directors who want clarity on:
- setup vs ongoing fees
- property-related costs
- long-term value vs short-term savings
Ask AccounTax Zone to review SSAS or SIPP costs before you proceed.
What Fees Should I Expect When Setting Up a SIPP Versus an SSAS?
A SIPP often has:
- Lower starting costs
- Platform fees (percentage-based)
- Fund dealing fees
- Higher property administration if using a property SIPP
A SSAS often has:
- Higher setup cost
- Higher annual admin cost
- But may be flat-fee and scalable for larger funds or multiple members
Rule of thumb:
- Smaller pots + simplicity = SIPP
- Larger pots + directors + property/business intent = SSAS pension scheme
How to Choose the Best SSAS Pension Provider for Small Businesses
Here’s a checklist directors should actually use:
1) Experience With Small Business Directors
Ask:
- How many SSAS schemes do you administer?
- How many are director-led?
- Do you support commercial property regularly?
2) Clear Fee Transparency
You want:
- A written fee schedule
- Clarity on property and lending costs
- No hidden “per action” surprise fees
3) Support Quality (This Is Huge)
SSAS success depends on responsiveness. Ask:
- Do we get a named manager?
- What’s the response time?
- Do you provide trustee training/support?
4) Online Access and Reporting
- Portal?
- Bank visibility?
- Document signing and secure storage?
5) Ability to Handle Property and Complex Transactions
If your clients want:
- property purchase
- leaseback
- borrowing
- VAT on property
…pick a provider who deals with this weekly, not annually.
How to Compare SSAS Pension Products and Their Investment Options
Because SSAS is a structure (not a single “product”), comparison often means comparing administrators and the investment flexibility they support.
Compare Based on:
- Asset types allowed (by administrator)
- Execution process speed
- Trustee control
- Costs over 5–10 years
- Property support dept
- Ability to scale for multiple members
A “cheap SSAS” that makes property painfully slow is not really cheap.
How to Transfer My Existing Pension Into a SSAS Pension Scheme
This is one of the most common SSAS strategies — consolidate old pensions into one structure, then implement the investment plan.
Typical Transfer Steps
- SSAS is established and registered
- Each member requests transfer values from existing providers
- Transfer paperwork is completed
- Funds arrive in SSAS bank/account
- Trustees allocate investment strategy
Transfers usually work smoothly for defined contribution schemes, but always check:
- Exit penalties
- Guarantees being lost
- Protected pension ages
- Any safeguarded benefits
Already have pensions elsewhere?
Many directors hold multiple old pensions without realising how consolidating them into a SSAS pension scheme or SIPP could simplify planning and improve tax efficiency.
Get a no-cost pension transfer suitability check.
Which Providers Offer the Best SIPP and SSAS Pension Plans in the UK?
“Best” depends on your criteria:
Best for DIY Investing + Low Cost
Often SIPP platforms win here, especially if the director wants:
- Funds, ETFs, shares
- Live dealing
- Low platform charges
Best for Business Owners + Property + Governance Flexibility
SSAS administrators win if the priority is:
- property purchase and leaseback
- loan-back to company (where appropriate)
- multi-member pooling
- trustee-led control
In practice, many directors end up with both:
- SSAS for business/property strategy
- SIPP for personal investing flexibility
(Again: depends on the individual plan and compliance.)
Which Pension Scheme, SIPP or SSAS, Is Better for Business Owners?
Let’s make this practical.
SSAS Pension Scheme Is Often Better If You:
- Own a trading company and take dividends
- Want the company to contribute larger amounts
- Want pension-led commercial property
- Want pooling across directors/family employees
- Want potential business funding options under strict rules
- Are comfortable with trustee responsibility (or want a professional trustee)
A SIPP Is Often Better If You:
- Want simple setup and management
- Prefer a slick online platform for investing
- Have a smaller pot (or are just starting)
- Don’t need business-related strategies
- Want maximum personal portability
Quick Decision Framework
Ask these 6 questions:
- Do you want the pension to buy your business premises?
- If yes → SSAS often fits very well.
- Do you want the pension to be able to support business funding under strict rules?
- If yes → SSAS.
- Do you want minimal admin responsibility?
- If yes → SIPP.
- Is your pension pot likely to exceed £200k relatively soon (especially with multiple directors)?
- If yes → SSAS can become cost-efficient.
- Are you contributing mainly through the company?
- If yes → SSAS is commonly used.
- Do you want maximum “platform investing” features?
- If yes → SIPP.
Common Mistakes Directors Make With SSAS and SIPP Planning
Mistake 1: Choosing Based on Setup Fee Alone
A SSAS that is cheap to set up but slow and unresponsive can cost more long-term.
Mistake 2: Not Checking Property Capability
Not all providers handle property smoothly, especially where VAT elections, leases, and borrowing are involved.
Mistake 3: Ignoring Trustee Responsibilities
SSAS trustees have obligations. If the directors want “zero involvement”, a SSAS may not be ideal unless a professional trustee is heavily involved.
Mistake 4: Overlooking Annual Allowance and Carry Forward
Your contribution plan should be mapped over multiple years, especially if you’re aiming for aggressive director funding strategies.
Mistake 5: Treating Pension Strategy as Separate From Profit Extraction
A well-designed plan considers:
- salary and dividend mix
- pension contributions
- cash flow forecasting
- corporation tax planning
- long-term wealth building
Final Thoughts: SSAS Pension Scheme vs SIPP – It’s Not About “Which Is Best”, It’s About “Which Fits”
A SSAS pension scheme is often the “power tool” for directors:
- more control
- more flexibility
- stronger business/property planning potential
A SIPP is often the “everyday tool”:
- simpler
- accessible
- platform-driven investing
If your goal is to save serious tax while building long-term wealth, pensions should not be an afterthought, and for many directors, a SSAS pension scheme becomes the centrepiece of that plan.
Final Thought for Directors
A SSAS pension scheme can be one of the most powerful planning tools available to business owners, but only when aligned with profits, cash flow, and long-term goals.
At AccounTax Zone, we help directors:
- decide between SSAS and SIPP
- structure employer contributions efficiently
- assess commercial property strategies
- avoid costly pension mistakes
Book your free SSAS and pension planning consultation.
Disclaimer
This article is for general information only and does not constitute financial, tax, or investment advice. Pension rules are complex and may change. Always seek advice from a regulated financial adviser and your accountant before taking action, especially where commercial property, borrowing, or connected-party transactions are involved.
