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SIPP provider for French Leaseback


Steph1

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Initially, the Government was going to allow personal pension funds to invest in residential property and this created considerable interest from investors. However in December 2005, the Chancellor announced a U-turn by announcing that additional tax would be charged if a pension fund invested in residential property.

If a "self directed" pension invests in residential property or "prohibited investments" such as vintage cars, works of art or fine wines an extra charge will be applied. A tax charge of up to 70% of the value of the prohibited investment can be levied.

This means that although it will be possible to invest in residential property the additional tax charge makes it an unattractive option.

Pensioneer trustees are responsible form the legal maintenance and upkeep of any property and therefore even though residential property is allowed within a SIPP (if you want the punitive tax) they will not take it on, in this country, never mind a foreign residency.

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Hi PeterG

Thanks for your reply. The Leaseback property purchase in France is classed as a commercial transaction as there is no residential element, there are SIPP providers who do allow the purchase of these properties as I have seen them advertising in magazines.

Steph1

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[quote user="Steph1"]

Hi PeterG

Thanks for your reply. The Leaseback property purchase in France is classed as a commercial transaction as there is no residential element, there are SIPP providers who do allow the purchase of these properties as I have seen them advertising in magazines.

Steph1

[/quote]

If you have seen advertisments in magazines for SIPP providers allowing these purchases, then you have answered your own question.

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I have perhaps worded my reply badly, what I meant to say was I have read articles and property advertisements stating that you can purchase the property through your SIPP but I now cannot find the magazine, hence why I asked the question.
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