Using Property as a “pension contribution”

Using Property as a “pension contribution”

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Case study of using property as a pension contribution

As well as making a cash contribution, it is possible to transfer property into a SIPP and, subject to HM Revenue and Customs rules, receive tax relief on the full capital value.

Individual contribution
Rachel owns her own art studio worth £100,000.   During the year in question, she makes a pension contribution by transferring ownership of the property into her own SIPP.   Because her earnings for the same year are in excess of £100,000, she is eligible to receive tax relief on the whole capital value at her highest marginal rate.

Joint contribution
Michael and his business partner Mark jointly own a dental surgery worth £120,000. Both Michael and Mark will earn £60,000 in the current year so plan to “contribute” the property to their SIPPs in equal proportions. Each SIPP will own a 50% (or £60,000) share in the property. Michael and Mark will receive tax relief based on a contribution of £60,000.

Part contribution
Lynne owns a hairdressing salon worth £160,000. In the year in question she will earn £50,000. She decides to “contribute” a £50,000 share in her property to her SIPP.
In subsequent years Lynne plans to transfer further shares in her property until it is fully owned within her SIPP.


1. There are no limits on the level of contributions that may be paid to a SIPP but there are limits on the tax relief you can receive. UK residents under the age of 75 can contribute up to 100% of earnings and receive tax relief at their highest marginal rate.   This limit is applied to all contributions made to all schemes and is also subject to the annual allowance.
2. It is possible to transfer other types of “property” as in-specie contributions into a SIPP such as stocks and shares.
3. Employer contributions, whether in cash or in-specie are always treated as gross receipts by the SIPP i.e. no tax relief is reclaimed by us.

For help and advice on using property as a pension contribution call 0800 043 0725

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