Self-invested personal pensions (SIPP) commercial property queries at provider Curtis Banks increased 56% in the first half of 2021 compared to the same period last year.
It said commercial property remains a popular investment for SIPPs due to the tax efficiency of the investment, including rent being paid tax free directly to a client’s pension, and no capital gains tax on disposal.
In recent months, Curtis Banks said it had noticed an increase in queries regarding connected party purchases – whereby a person uses their pension to purchase a property they already own, such as business premises – as well as more queries about purchasing land and woodland rather than a commercial building.
The provider said it believed the former was being driven by business owners looking to release cash back into their businesses, and the latter by individuals who have been able to accrue additional savings during the pandemic due to lower outgoings and are now looking to invest their cash.
In response, Curtis Banks said it had updated its Property Guide that can aid advisers when explaining the different types of property that can be purchased and the process behind purchasing a property for a SIPP to their clients. The property guide can be found on its website.
Pension technical manager Jessica List said: “Curtis Banks continues to see interest from advisers and their clients in investing in commercial property as part of a SIPP. This is a very complex and technical area for advisers to navigate and Curtis Banks aims to provide advisers with the best possible assistance to navigate the complexity.”
Red Star Wealth managing director Kristen Cunliffe added: “Similarly to Curtis Banks, we are also seeing sustained interest from clients who would like to include a commercial property investment in their SIPP. I find the Curtis Banks expertise particularly helpful while their legal and property services provide additional advice to ensure the process is smooth.”