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Ever wanted to own a wood for camping or a field to graze your horse? You may be interested to know that your pension fund can buy some amenity land.
Ok, it is not as straightforward as simply buying the land and pitching your tent. Pension scheme rules state that you cannot personally benefit from the enjoyment of the land, which sounds like it defeats the object of buying the land in the first place.
Before you bin your dream of an exclusive camp site or timeless grazing for your animals, you can enjoy your own peaceful haven if you pay your pension fund an appropriate rent for doing so.
Again, nationwide property sites provide many examples of fields, woods and meadows for sale. Whilst these are unlikely to yield significant returns, they can be enjoyed for their therapeutic and restorative benefits. However, it needs to be understood that in order to utilise your land it is essential that an open market rent is paid to your pension fund.
Daisy has always wanted to own a horse, but due to the lack of local stabling she has not been able to realise this childhood dream. Recently she has noticed that a local two-acre field has come onto the market for £20,000 and has asked her pension provider if this is something that she can buy with her SIPP.
The SIPP provider has confirmed that this is an acceptable investment and Daisy proceeds to buy the field using funds in her pension scheme. Daisy then sets up a lease agreement between herself and the SIPP in order to ensure that she pays an open market rent for the use of the field. She personally funds the construction of a stable block and at last fulfils her dream of owning a horse.
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This is for UK intermediary, broker and adviser use only – it is not for use with retail clients
This information reflects the regulatory and taxation situation as it affects pensions at the time of publication in April 2017 and is provided to the best of our knowledge. It is not a complete representation of the pensions legislator landscape and is for guidance and information purposes only. We cannot be held responsible for any errors, omissions or subsequent legislative changes.
For further information on your pension scheme administered by Morgan Lloyd, or any enquiry, please do not hesitate to call and one of our team members will be happy to helpView more