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Buying a woodland with your SIPP. ~ by Nick H

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. trees

 

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.

Posted in: Energy, sustainability & economics, Woodland Activities ~ On: 28 June, 2012

36 comments so far

Sean Jones
17 September, 2015

Hi All,
I am an independent financial adviser, and can therefore point you in the right direction. The rules are quite complex,and there are many hoops to jump through before simply going out and buying a wood. You can go direct to the provider or if you would like to know more, then I would be more than happy to advise you, ensuring that you do it properly and don’t fall foul of the HMRC. [email protected]

michele
17 May, 2015

Hi Nick
Please could you advise me of your schemes name to transfer my sipp.
Regards
Michele

Paul
15 October, 2014

Sorry guys but I think this is a dead end… After two years I have yet to hear anything from Nick.

Mike
14 October, 2014

HI Nick

I would be grateful if you could send me any information on buying a wood with an SIPP.

Regards,

Mike

greg
13 October, 2014

i am interested in knowing which SIPP provider you used. thanks

Elaine Ireland
7 October, 2014

Hi Nick,

I realise it is now 2014, but I would really appreciate information on your pension (SIPP) provider and any further helpful information you can provide 2 years on please.

kind regards,

Elaine

Richard
31 August, 2014

As per the other requests can you please share with me the name of the SIPP provider you used?
Thank you

Kevin
13 August, 2014

Hi,

please can you give me details of the Sipp provider, I have a very similar situation, thank you

Lawrence
11 August, 2014

Great post. Please can you let me know the SIPP provider too? Thanks.

Andy
24 July, 2014

Also interested in the provider details if you can pass them on.

Thanks
Andy

Patrick
15 July, 2014

Hi

I would be very interested in the contact info for the SIPP provider you used.

kind regards
Patrick

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