While many tax misdemeanours in SSASs are through lack of understanding, there is a worry that SSASs could deliberately be used in place of Sipps to funnel pension funds into speculative investments.
There is an in-built higher barrier to entry for setting up a SSAS – the employer must create it. But it is easy to set up a company online for less than £50 and use it to start a SSAS, even if it is a non-trading company. It is unlikely such people would appoint a professional trustee, so the risk is real. Consumers must be educated about the risks of investing in speculative funds and the authorities must take early action against any fraudulent investment providers or promoters.
As long as no major issues come to the fore, hands-off regulation will continue to work for SSASs. The one area that would make a big impact would be the re-establishment of a required pensioneer trustee to ensure the correct running of SSASs.
Andrew Roberts is a partner at Barnett Waddingham
