How to Buy Commercial Property with Your Pension (SIPP or SSAS) in the UK
- Admin
- Sep 12
- 3 min read
Introduction
Using your pension to buy commercial property is one of the most tax-efficient strategies available to UK business owners and investors. Whether you’re considering a Self-Invested Personal Pension (SIPP) or a Small Self-Administered Scheme (SSAS), this approach can help you grow your retirement fund while securing premises for your business.
At Blackmount Private Wealth, we help clients across Glasgow, Renfrewshire, and the wider UK navigate this opportunity with clarity and confidence.
What is a SIPP or SSAS?
SIPP (Self-Invested Personal Pension): A personal pension that gives you control over your investments, including commercial property.
SSAS (Small Self-Administered Scheme): A workplace pension typically used by company directors and senior staff, offering similar flexibility but often with more control for business owners.
Both allow you to invest in UK commercial property.
Why buy commercial property with your pension?
Using your pension to invest in commercial property offers several compelling benefits:
Tax-free rental income: Rent paid into your pension is free from income tax. It can then be reinvested within the pension to grow your retirement fund.
No Capital Gains Tax: When the property is sold, any gains stay within the pension and are not subject to CGT.
Business synergy: You can lease the property back to your own business, turning rent into pension contributions.
Long-term growth: Commercial property can offer stable, inflation-beating returns over time.
SIPP vs SSAS -- What's the difference?
Both SIPPs and SSASs allow you to invest in commercial property, but they suit different needs:
Feature | SIPP | SSAS |
Who's it for | Individuals | Company directors & employees |
Control | Managed by provider | Trustees (often the business owners) |
Borrowing | Up to 50% of fund value | Same, but more flexible in structure |
Joint ownership | Yes | Yes, including with your company |
What can you buy?
You can use your pension to purchase:
Offices
Warehouses
Retail units
Industrial premises
Land for commercial use
Residential property is not allowed, unless it's part of a mixed-use building and meets strict HMRC criteria.
Can your business use the property?
Yes -- and this is where it gets interesting.
Your business can lease the property from your pension scheme under a "connected party transaction". This must be done at market rent, with a formal lease agreement in place, and independently valued by a RICS-registered surveyor.
This setup allows:
Your business to claim rent as a deductible expense
Your pension to receive tax-free income
You to retain control of your premises.
What about borrowing?
Your SIPP or SSAS can borrow up to 50% of its net asset value to help fund a property purchase. This can be a game-changer for businesses looking to scale or secure premises without tying up working capital.
What happens at retirement or death?
At retirement: You can draw income from rent or sell the property to release capital.
On death: The property can be passed to beneficiaries, often free from Inheritance Tax (IHT) -- although new rules from April 2027 may change this.
Is this right for you?
Buying commercial property through a pension isn't for everyone. It requires:
A long-term investment horizon
Professional advice and due diligence
Understanding of pension rules and tax implications
That's where we come in.
How Blackmount Private Wealth can help
At Blackmount Private Wealth we specialise in helping business owners and professionals across Scotland and the UK make smart, tax-efficient investment decisions. Our advisers can help you:
Assess whether a SIPP or SSAS is right for you
Structure your pension to purchase property
Navigate HMRC rules and compliance
Align your property investment with your retirement goals.
Ready to explore the opportunity?
Whether you are based in Glasgow, Renfrewshire, or anywhere in the UK and want to explore how your pension could help you buy commercial property, we'd love to help.
Call us on 0141 286 4342
Email us at email@blackmountwealth.co.uk
The value of investments, and any income from them, can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. A pension is a long term investment not normally accessible until age 55 (57 from April 2028). Taxation depends on individual circumstances as well as tax law and HMRC practice which can change.
It is important to take professional advice before making any decision relating to your personal finances. Information within this blog is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for information only. We cannot assume legal liability for any errors or omissions it might contain.
