EXAMPLE 3 Across the road, Dave’s café has also come up for sale for £180,000. He realises the advantage of owning the property in his pension fund and particularly likes the idea of paying the monthly rent of £1,400 straight to his own pension, rather than to a landlord. Unfortunately, Dave’s pension fund is only worth £140,000. However, his adviser tells him that by transferring his pension savings into a SIPP or SSAS, his fund can be used to obtain a mortgage to meet the shortfall. A mortgage of £40,000 is arranged and the pension fund buys the property for £180,000. The pension now receives monthly rent of £1,400 and pays £320 for the mortgage* pension fund company Buy the premises £150,000 GIFT SHOP Monthly rent £1,200 pension fund company mortgage Towards buying the premises £140,000 £320 DAVE’S CAFE Monthly rent £1,400 * Mortgage based on a capital and repayment term of 15 years at a fixed rate of 5%pa These examples do not take into account any costs. pension fund company Buy the premises £150,000 GIFT SHOP Monthly rent £1,200 pension fund company mortgage Towards buying the premises £140,000 £320 DAVE’S CAFE Monthly rent £1,400 EXAMPLE 2 Carly runs a successful gift shop in the High Street. She currently pays rent of £1,200 per month to her landlord. The landlord, who is an investor, decides to sell the premises for £150,000. Carly discovers that the value of her pension fund is £150,000 and decides to use this money to buy the premises after transferring her existing personal pension into a SIPP. Her business continues to pay £1,200 per month for the rent, but this is now being paid straight into her own pension fund. COMMERCIAL PROPERTY OWNERSHIP IN YOUR BUSINESS VISIT www.morgan-lloyd.co.uk EMAIL tom.whitlock@morgan-lloyd.co.uk TEL 01275 813726 6 7