Buying a woodland with your SIPP.
It may not be the most obvious asset to hold in a Self-Invested Pension Scheme (SIPP) but there is no reason in principle why you cannot do so. Provided that the woodland generates an income for the fund it will qualify as a commercial property, so how can this be done?
In my case, I have a SIPP which until recently was invested in the stock market. I decided earlier this year that I no longer wanted to run the risk of losing what I had worked hard to build up and began to look at other options. I was also interested in buying and managing a small wood because of my interest in natural history and ecology.I approached my pension trustees and hey confirmed that there would be no problem in my SIPP owning a wood. They sent me a questionnaire to complete and arranged for an independent valuation to be carried out of the freehold value and rental value of the wood. It is very important that this is all done on an independent and arms-length basis to avoid any problems with the Revenue. 
To cut a long story short, my Pension Trustees then bought the wood (through woodlands.co.uk) and granted me a lease in the form of a farm business tenancy at the rental set out in the valuation (£100 per acre per annum). The rent (which must be paid on time and in full) is paid to the pension on a quarterly basis and will therefore increase the value of the pension over time. Although I do not “own” the wood it feels very much like I do and when retirement comes there would be nothing to stop me from buying the wood from my SIPP at the open market value at that time.
The process worked out smoothly from start to finish and I benefited from having Trustees who knew exactly what they were doing. I am aware that this is not always the case and that some pension trustees are reluctant to invest in farmland or woodland. It is possible though to transfer your fund and I’d be happy to pass on my pension fund’s details to anyone who would like to know more.
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13 comments so far
Paul
4 July, 2012
Hi Nick,
I would be grateful if you could send me your pension fund details.
Thanks very much,
Paul
Anthony Dowling
10 July, 2012
Hi Nick,
I would also be grateful for more details as I am in the process of amalgamating several pension schemes I have started over the years from previous jobs. I have been trying to decide on the best place to invest the sum I now hold as cash at present.
This idea appeals to me very much.
Best wishes
Anthony
Neil
29 August, 2012
I have someone who is interested in forestry for a pension. On scanning the normal SIPP providers i was wondering who you used
tony
20 September, 2012
hi–i have the same request –could you give me the details of the scheme you arranged your woodland purchase through
regards
tony
peter byrne
25 November, 2012
Nick, I would be grateful for any details on how you put a woodland into your sipp. Thanks. Regards, Peter
jillian
30 November, 2012
Dear Nick, I was looking into changing my pension into a sipp, but did not continue because of the stock market, i would be very interested in knowing who you went through to arrange your sipp in this way. regards
Nick
5 December, 2012
Nick
I would be grateful if you could send me your pension fund details.
Many Thanks
Nick
Deloris
31 December, 2012
Particularly well-researched article on Buying a woodland with your SIPP.
| Woodlands.co.uk…
Always keep blogging.
Steve
2 January, 2013
Hi, Please could you send me your pension fund details?
Many Thanks
Rebecca Wright
9 January, 2013
This sounds like a wonderful idea and very thoughtful of you to want to pass on such creative information.
I would be interested in any relevant info you could spare.
Many thanks
Rebecca
Allister
10 January, 2013
Hi Nick, I would be grateful of the details of the company you used to transact the sipp. This would be really helpful as I am interested in pursuing this as an option for my pension fund. Many thanks Allister
Mark
4 March, 2013
Hi Nick,
Similar request to the rest, I currently have a pension fund which has been frozen for several years, I’ve been considering a SIPP for some time and thinking about commercial property but would like to investigate the possibility of woodland instead. It looks like a better option as I would like to lease back as you have and enjoy the woodland.
Daniel Barnes
17 May, 2013
Hi Nick,
Like many others I’m in a position where I would like to use my pension fund (that now is in a SIPP) to buy a woodland, but my SIPP provider is unable to process this type of transaction. Out of interest which SIPP provider did you use as it’s something I would love to sort out!?