Tax Benefits of a SSAS Pension

A SSAS provides exceptional tax efficiency - six distinct advantages built into the pension structure from day one.

Six Tax Advantages at a Glance

Each of the following advantages applies to all SSAS schemes registered under Part 4 of the Finance Act 2004.

25%

Corporation Tax Relief

On employer contributions

CGT on Investments

All gains sheltered in pension wrapper

Income Tax on Rent

Rental income exempt within SSAS

£60,000

Annual Allowance

Per individual, tax year 2026/27

3 Years

Carry Forward

Unused allowance from prior years

IHT on Pension Pot

Pension funds outside estate (subject to rules)

The Six Tax Advantages Explained

Each advantage applies to all SSAS schemes registered under Part 4 of the Finance Act 2004.

Corporation Tax Relief

Employer contributions are an allowable business expense. At 25% Corporation Tax, a £50,000 contribution costs the company only £37,500.

Income Tax Relief

Director contributions receive tax relief at the marginal rate. Higher rate taxpayers claim further relief via self-assessment.

CGT Exemption

All investments inside the SSAS - including commercial property and quoted shares - are exempt from Capital Gains Tax on disposal.

Tax-Free Rental Income

Rental income from commercial property held in the SSAS is received free of Income Tax within the scheme.

Annual Allowance & Carry Forward

£60,000 annual allowance in 2026/27, with the ability to carry forward unused allowance from the prior three tax years for large one-off contributions.

Inheritance Tax Advantages

Pension funds held in a SSAS generally fall outside the estate for Inheritance Tax purposes, subject to discretionary trust rules and beneficiary nominations.

Corporation Tax Relief - Worked Example

Employer contributions to a SSAS are treated as an allowable business expense under Section 196 of the Finance Act 2004, subject to HMRC's ‘wholly and exclusively’ test.

Example: £50,000 Employer Contribution

Gross contribution£50,000

Corporation tax relief (25%)−£12,500

Net cost to company£37,500

Amount received in pension£50,000

CGT Exemption - Worked Example

Property Sale Inside the SSAS

A property purchased by the SSAS for £500,000 and later sold for £750,000 creates a £250,000 gain.

Held outside a pension: potential CGT of £45,000-£60,000 at 18-24% rates.

Inside the SSAS: the entire £250,000 gain is sheltered within the pension wrapper - zero CGT payable.

Annual Allowance and Carry Forward

The standard Annual Allowance for pension contributions is £60,000 per individual in 2026/27. Unused Annual Allowance from the previous three tax years can be carried forward, allowing larger one-off contributions in profitable years.

For directors, coordinating the timing of employer contributions with the company's financial year can maximise tax efficiency - particularly in years with exceptional profits.

2026/27 Annual Allowance£60,000 per person

Carry Forward Period3 prior tax years

Tapered AllowanceThreshold income >£200,000 and adjusted income >£260,000

Money Purchase Annual Allowance£10,000 (post-flexible access)

Inheritance Tax Advantages

On death, pension funds held in a SSAS generally fall outside the member's estate for Inheritance Tax purposes, subject to discretionary trust rules and the nomination of beneficiaries. This makes the SSAS a powerful IHT planning tool alongside its primary function as a pension.

The pension pot passes to nominated beneficiaries through the trust structure - outside the probate process and outside the estate for IHT.

IHT Changes from April 2027

From April 2027, legislated changes to pension IHT treatment will affect the position of pension funds in the estate. Directors who establish a SSAS and make full use of the existing IHT position before April 2027 may benefit from the current rules for assets already within the structure. Early action is advisable.

How the Referral Process Works

From introduction to fee paid — a simple 5-step process.

Step 1

You Submit a Referral

Step 2

TLPI Contacts the Client

Our SSAS specialists reach out within 1 business day to explain the benefits. You do not need to do anything else.

Step 3

SSAS is Established

TLPI handles scheme set-up and HMRC registration. The client’s SSAS is fully established and operational.

Step 4

You Receive Your Referral Fee

Once the SSAS is set up and active, TLPI pays your referral fee. Fee is paid on scheme establishment, not on referral.

Step 5

Your Client Saves Tax

The director benefits from Corporation Tax relief, CGT exemption, and the ability to hold their business premises in their pension.