Pension Finance explained

Pension finance is a form of business funding that utilises the personal pension of one or more directors of a company.

Have the facts before you apply
Pension funding is still a relatively unknown product and offers the ability to raise funds based upon the pensions accrued by one or more owners or directors of the business they control. Any money lend to the business is paid back with interest and will increase the size of the pension.

It is a complex product, but in essence any amount borrowed works like a business loan, i.e. the amount is borrowed from the personal pension pot(s) and paid back with interest by the business. This means that a growing business can also increase the pension pot(s) of its director(s). There are alternative ways for the pension to invest directly in the business, to find out more please ask for a call back by our advisors.
Advantages of pension finance

Advantages include:

  • Borrowing from personal pensions means the interest paid back increases the pension pot
  • HMRC compliant scheme
  • Personal guarantees and charges over property may not be required
Disadvantages of pension finance
Disadvantages include:
  • Pensions are a long-term savings vehicle to provide retirement provision for its members
  • The amount you can borrow is limited by the size of the pension pot(s)
  • The set up time is several weeks
  • Borrow
    From £50,000 to £1 million or more
    From 1 month to 5 years
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