SSAP Frequently Asked Questions

We have identified a number of key questions that people may have regarding Small Self Administered Pensions:

Q. What is a (SSAS) Small Self Administered Pension?

This is a Revenue Approved scheme which is set up by a company for an employee or indeed for a director. The individual controls how the SSAS is invested.

Q. What are the benefits of a Small Self Administered Pension?

A. The benefits are that the pension is flexible and allows you a high element of control. You have a large selection of investment options such as direct properties, shares and bonds to suit your risk profile. Your pension can also currently borrow, remember you work with your advisors, investment managers and accountant to chose the right investment strategy. You have complete investment control of your pension. You also have large scope to make contributions into the scheme. Another advantage of a SSAP is that you can put in Company Pension contributions as and when it suits!

The following is a summary of the advantages of establishing a SSAP:

  • You act as your own trustee in tandom with us as Pensioneer Trustees (gate keepers)
  • You can work with your Accountant, Advisors to control your own destiny by designing your own investment portfolio
  • You have the option to purchase your own shares, property, unitised funds and many other investments
  • You can control the amount of contributions into your scheme
  • You can work with your advisors in a flexible way using the vehicle as an important estate planning tool
  • Excellent vehicle for moving assets into a pension scenario.
  • You have obvious tax advantages of having a SSAP
  • A SSAS / SSAP will give you a clear understanding and transparency on costs associated with your pension
  • The SSAS / SSAP allows you to cut out commissions and unrelated fees associated with your pension
  • The SSAS /SSAP will reduce the costs of having a pension and allow you to deal direct with Fund Managers and Asset Managers by cutting out in many cases the middle man

How can I set up a Small Self Administered Pension Arrangement (SSAP)?

You need to call Paul Ryan Independent Pensions and request a Signature Trustee Services pack on 01-4546730 or email us on info@paulryan.ie. We specialise in the administration of SSAPS and we work on a fee basis so all our SSAPs are fully transparent. We work with Advisors and Accoutants all the time and we welcome any opportunity to showcase our business ethos. We offer full transparency on all our dealings with new and existing clients and we are confident that we can look after and handle you or your client in the most professional manner. Our business is built around our reputation in a small industry.

What is the difference between a Small Self Administerd Pension and normal pension?

Small Self Administered Pension arrangements are deemed by Revenue to be “self-administered” where contributions are invested through us as the Pensioneer Trustee rather than going through the normal route of an insurance company. We believe that in many cases the SSAP / SSAS method can save you costs by cutting out the insurance company. If we think you are not suited to a Small Self Administered Pension we will let you know. Remember you also have the option of investing within an insurance company through a Trustee Investment Plan so you can get the best of both worlds. We as the Pensioneer Trustee (Signature Trustee Services) report to the Revenue and Pensions Board directly on your pension schemes behalf.

Q.What happens if i die before retirement in a (SSAS) Small Self Administered Pension?

The value of your SSAS fund at the time of your death is used to provide benefits to your dependants.

Q. How many people can have a Small Self Administered Pension? 

In practice most SSAP's attract a membership of one member but you can have more than one member if required. Often the Trustees will be listed with the Pensioneer Trustee. Most schemes will have a Husband and Wife as the Trustees .

Q. How is money mostly transferred into a (SSAS) Small Self Administered Pension?

  • The employer mostly pays the contributions, sometimes the member of the SSAS does as well. Contributions are tax deductible.
  • Transfer values from another scheme can be moved over to a (SSAS) Small Self Administered Pension.

Q. A (SSAS) is established under Trust, what does this mean?

It is a legal requirement for your SSAS to be established under Trust. We have a legal document prepared called a Trust Deed. In the Deed a number of nominated persons are appointed to hold the assets in accordance with the legislation. These people are always the Pensionieer Trustee and the Beneficiary Trustee, known as Trustees. The Deed is submitted to Revenue for Approval of the scheme.

Q. Who act as Trustee on a Small Self Administered Pension?

One of the attractions of Small Self Administered Pensions over insured arrangements is that there is NOT an onus on the company to act as Corporate Trustees to the scheme. It is our job to ensure that your scheme is compliant and that you are fully up to speed with the very latest in pension practice. We will arrange for any relevant training to ensure you as the Trustee know your obligations to your scheme. There is a lot of increased compliance for Trustees in the current pension's framework documentation which is making insured arrangements unattractive. That is why we see more companies prefer to set up Small Self Administered Pensions for their staff. In the case of your Small Self Administered Pension you are the Trustee and the Pensioneer Trustee (Signature Trustee Services) act as the co Trustee. Basically it is our job to work with you to ensure that your pension stays within the remit of the legislation.

Q. Is there ever a reason why an individual can not act as a Trustee?

Yes there are many reasons, but the most common reason is as follows:

  • If you are bankrupt
  • If you are restricted by the Companies Act from acting as a director
  • If you are prohibited from acting as a Trustee by the Pensions Board
  • If you have been convicted of an offence

How do i control my SSAS / SSAP - Small Self Administered Pension?

A small Self Administered Pension is ideal if you are a company director or if you have a pension scheme which you want to control. Effectively when we set up our Small Self Administered Pensions under Trust, they allow you as the co-Trustee / Beneficiary an element of control of your pension. For example this is beneficial when you are looking to buy a particular investment property to place in your pension arrangment. The Trust gives the Trustee flexibility and control of the assets that they chose to sit within their pension arrangement. We act as Pensioneer Trustees to ensure that your pension meets the relevant guidlines set down by the Revenue Commissioners and Pensions Board. We are the "gate keepers"!
 

How much is a Small Self Administered Pension?

In our opinion, if you are not sitting a property into your pension than you will need a fund of circa €150,000 to justify the initial cost of a Small Self Administered Pension. It also helps for you to have a clear strategy in mind for your pension going forward.  We will tell you if it makes financial sense to establish a SSAP as not every individual is suited to a Small Self Administered Pension. Sometimes we as Pensioneer Trustees may recommend for you or your advisor to establish an Executive Pension for a few years until your fund is large enough to set up a Self Administered Pension or SSAS / SSAP. The cost of a SSAP /SSAS will depend on the size and amount of assets we need to sit into the portfolio. If you have multiple properties and other investments then our fee will reflect the work that is required for us to act as Pensioneer Trustees. Generally the cost from our perspective of setting up a SSAP varies depending on the clients assets. Most of our clients pay €2,500 plus Vat in the first year, this covers the preparation of the Deed and the legal work involved in putting together a Deed which reflects the latest pension changes.  Once set up, our clients can expect to pay circa €2,000 plus vat per annum for Trusteeship. We charge a flat fee regardless of the size of your pension fund. If there is a property adding to the scheme we have to charge an additional €600 plus vat per annum. You can be confident that our fee is fixed and agreed in advance and we do not take any hidden commissions or charges. The annual agreed fee covers all the administration work for your scheme and it also takes into account time for common queries and questions that you or your advisors may have during the year. Rarely, do we need to charge additional time and if this is the case we will tell you in advance before we carry out work on your scheme. The reason for a slightly higher fee in year one is because we tailor a specific Deed complete with the latest changes in pensions legislation for each new pension we establish. Matheson do our legal work on the content of your Deed and the additional fee in year one covers the once off cost for the preparation here in Paul Ryan of your individual Trust Deed. By year two expect our flat fee to be €2,000 plus vat, the flat fee approach should mean we are probably the most cost competitive Trustee in Ireland.

Q. What doe the Pensioneer Trustee do for their fee?

There are many duties imposed on the Pensioneer Trustee, broadly the main areas of concern to the PT are as follows:

  • The PT will register your pension with the Pensions Board
  • Pay the annual registration fee to the  Pensions Board
  • Appoint a Registered Administrator
  • Ensure all financial records are kept and are up to date in relation to the scheme
  • Handle all administration of your scheme

Q. What is a Pensioneer Trustee?

We at Paul Ryan Independent Pensions are Pensioneer Trustees for Small Self Administered Pensions or SSAS's / SSAP's. We use our Trustee Company Signature Trustee Services to provide the service. We are the people who are authorised by the Revenue Commissioners to act as a professional pension scheme trustee. You need us in order to set up a Small Self Administered Pension. We simply act along with you or your partner as trustees and our job is to ensure that the scheme stays compliant with the Revenue and Pensions Board legislation. We can not offer advise, you need to consult with your accountant or advisor when deciding on investments. As the Pensioneer Trustees we are the administrators for your pension and we are the people who seek approval from Revenue and administer the entire process of maintaining your pension scheme. We will look after everything involved in setting up your new pension and allow you to begin the process of sitting up a share portfolio, property portfolio and various other assets which you want to sit in your pension. We are the gate keepers of your pension arrangement, you would work with your investment managers, accountants and advisors and its our job to ensure that the assets within your pension are correctly administrated and in line with your investment strategy. Unlike other pensions, you have control of your fund!

How can you calculate the amount of a pension contribution into my SSAP?

In a way there is very little to place a limit on the amount of pension contributions you can make to a Small Self Administered Pension. The amount you can personally make is based on your salary and this can change from year to year.

What are my options at retirement age from a SSAP / SSAS (Small Self Administered Pension/Scheme)?

You have many different options at retirement. One of the most common options selected is for the individual to take 25% out of the fund at retirement tax free. You can then choose to draw down the balance of the fund at your leisure in retirement. These funds are usually placed in an Self Administered ARF and / or AMRF for you to control at retirement. Currently the minimum you must drawn down is 5% per annum. You can take more than 5% but your marginal tax rate will apply to your draw downs. You can take this draw down as a regular income or alternatively you can take it as a once off payment annually.

How is my fund distributed at retirement?

When you retire you can take your tax free lump sum of 25% with the balance of funds moving into an Approved Retirement Fund (ARF). If you don't have a guaranteed income of €12,700 per annum you need to invest €63,500 into an Approved Minimum Retirement Fund (AMRF). You also have the option of buying an income for Life known as an Annuity.

Q. Who are the parties involved in running my (SSAS) Small Self Administered Pension?

The Employer: They set up the SSAS and make the contributions. If you own your own company this can be your responsibility to set up the SSAS.

The Trustees: The Trustees run the SSAS, you are the Trustee and beneficiary and you work with the Pensioneer Trustee (us) and any other Trustees to make sure the SSAS is run in line with the legislation. The Trustees legally hold the trust fund assets and they run the Small Self Administered Pension in line with the Trust Deed. They also have a number of duties which are outlined under Revenue requirements.

The Pensioneer Trustee: You need Paul Ryan IPFC as the Pensioneer Trustee. We use our in house Signature Trustee Services company as our Pensioneer Trustee for schemes. All SSAS / SSAP schemes are required by Revenue  to have an Independent Pensioneer Trustee like ourselves. The Pensioneer Trustee must be a co-signatory for all financial transactions.

The Administrator: This is the person who is responsible for looking after the administration of the scheme. The administrator is required by law to ensure that regular returns for the SSAS and any other requirements are made to ensure the scheme remains compliant. We at Paul Ryan IPFC generally look after the administration of the scheme in conjunction with the Pensioneer Trustee. The role of the Administrator is very important especially now with the recent introduction of a "pensions levy" on all pension schemes.

The Registered Administrator: The Trustees of your SSAS or Small Self Administered Pension, must appoint a Registered Administrator. This is the person who has the responsibility of keeping the records for your pension. They prepare the Annual Benefit Statement and they make an annual Euro Statistics return to the Pension Board. In Paul Ryan Independent Pensions we will look after every aspect of setting up a Small Self Administered Pension but it is important to note what we do from a legislative perspective if you are considering a pension with our company.

The Member: You as the beneficiary are classed as the member and technically your role is to make investment decisions within the SSAS. Most SSAS's in Paul Ryan IPFC would have the member also appointed as a Trustee. As a member in a Small Self Administered Pension you control the investment decisions made within your pension arrangement. You would work with your Investment Manager, The Pensioneer Trustee and indeed your Financial Advisor to come up with a suitable investment strategy for your fund.

The Investment Manager: You as the member / beneficiary may also wish to appoint an investment manager to help with your investment decisions within your pension. The Trustees of your SSAS would appoint an Investment Manager.

Q. When can I retire from a Small Self Administered Pension (SSAP / SSAS)?

You can retire at any time after age 50.

 Q. Who are are parties involved in my Small Self Administered Penson or SSAS?

The parties involved are as follow:

  • Your Employer / Company
  • The Pensioneer Trustee -  Signature Trustee Services
  • You The Member
  • The Administrator

 Q. Why do i need a Trustee / Pensioneer Trustee and what are their duties?

 A Pensioneer Trustee is required by Revenue. The Trustee is an excellent "sounding board" for queries as they are duty bound to act in an independent manner and in accordence with the following rules:

  • Act in accordance with the terms outlined in your Trust Deed
  • Act in good faith and at all times in the best interest of the Trust beneficaries (You The Member)
  • Act prudently and diligently
  • Beware of conflicts of interest
  • Maintain confidentiality
  • Utilise the services of other professions when required (Legal, Accounting etc.)
Paul Ryan Independent Pensions & Financial Consultants Ltd is regulated by the Central Bank of Ireland.

© 2017 Paul Ryan IPFC

  • 19 Greenmount House,, Greenmount Office Park Harolds Cross Road, Dublin 6w Ireland
  • Phone: +353 1 4546730
  • Fax: +353 1 4163130
  • Email: info@paulryan.ie
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