The Role of SSAS in Employee Benefits: Enhancing Your Business Offering

Attracting and retaining top talent is crucial for the long-term success of any business. Offering competitive employee benefits is one of the most effective ways to differentiate your business in a competitive job market. While pensions are often seen as a standard benefit, SSAS pensions offer a unique and flexible way to not only benefit business owners but also to enhance your employee benefits offering.

In this blog, we’ll explore how SSAS pensions can be used as a powerful tool in your employee benefits strategy. From providing retirement savings options to helping your business build a more attractive benefits package, SSAS offers substantial advantages for both business owners and employees alike.

What is SSAS and How Can It Enhance Employee Benefits?

A Small Self-Administered Scheme (SSAS) is a pension plan designed for company directors and business owners, allowing them to have full control over how their pension funds are invested. One of the most flexible features of a SSAS is its ability to include employees as members, offering them the same investment benefits enjoyed by the business owner.

Key features of SSAS pensions:

• Investment flexibility
  Business owners and employees can invest in a variety of assets, including company shares, commercial property, and alternative assets.
• Tax advantages
  Contributions are tax-deductible, and all growth within the SSAS is tax-free, providing excellent tax efficiency for both the business and employees.
• Control
  The business owner has full control over how the funds are invested, allowing them to align investments with the business goals.

By including employees in the SSAS, businesses can enhance their employee benefits package with a flexible, tax-efficient retirement solution. It’s a win-win for both business owners and employees.

How SSAS Can Be Used to Improve Employee Benefits

Offering Employees a Competitive Pension Scheme

SSAS provides a fantastic way to offer employees a more flexible and potentially more lucrative pension scheme compared to traditional workplace pensions. By including employees in the SSAS, they can benefit from:

• Tax-free growth
   Just like business owners, employees can benefit from the tax-free growth of their SSAS fund, helping their retirement savings grow faster.
• Customised investment choices
  Employees can take advantage of the same investment flexibility offered to business owners. This means they can diversify their retirement savings across different assets, such as commercial property or private company shares.
• Wealth accumulation
  Employees benefit from the potential for higher returns, particularly if the SSAS invests in high-growth assets such as the company’s own shares or other business-related investments.

Offering employees access to SSAS as part of their pension scheme can set your business apart in a competitive job market and help you attract and retain talented individuals.

Aligning Employee and Business Interests

One of the key benefits of SSAS is the ability to invest in your own business. By including employees in the SSAS, you allow them to invest in the success of the business, creating a closer alignment between the interests of the business and its employees.

For example, employees can benefit from:

• Investment in company shares
  Employees can invest directly in the company through the SSAS, allowing them to benefit from the growth and success of the business they work for.
• Increased business ownership
  By giving employees access to SSAS, you can increase their sense of ownership and investment in the company, leading to greater engagement and productivity.

This shared commitment to the company’s success can help foster a more motivated, loyal, and productive workforce.

Tax-Efficient Contributions for Employers

As a business owner, contributing to your employees’ SSAS pensions can be tax-efficient for your company. Employer contributions to the SSAS are tax-deductible, which helps reduce your business’s overall tax liability.

• Corporation tax deductions
  Contributions made to the SSAS are deducted from your taxable profits, reducing the amount of corporation tax your business needs to pay.
• Flexible contribution amounts
  Contributions can be tailored to suit your business’s financial position, allowing you to offer employees a pension scheme that fits within your budget.

By contributing to your employees’ SSAS, you not only provide them with a valuable benefit but also make your business more tax-efficient.

The Benefits of SSAS for Employee Retention and Attraction

• Competitive Advantage in the Job Market

A well-structured SSAS pension scheme can help make your business a more attractive employer. As the demand for talent grows, offering competitive benefits is crucial for attracting the best candidates. A flexible and tax-efficient pension like SSAS can make your business stand out from others that offer more traditional pension schemes.

Employees value the opportunity to grow their wealth in a tax-efficient manner, and providing access to SSAS can help your business attract top-tier talent looking for long-term financial security.

• Employee Loyalty and Retention

Providing employees with access to a SSAS pension scheme can increase loyalty and retention.

Employees are more likely to stay with a company that offers flexible and valuable benefits, such as the ability to build wealth through a tax-free pension scheme.

By offering SSAS as part of your employee benefits package, you show employees that you are committed to their long-term financial well-being, which can help build trust and loyalty within the team.

How to Set Up SSAS for Employee Benefits

Setting up a SSAS to include employees as members is a relatively simple process, but it does require some planning and professional advice. Here’s how you can get started:

• Set Up the SSAS
  The first step is to establish a SSAS. You’ll need to work with a pension provider who specialises in SSAS pensions to ensure that the scheme is set up correctly and complies with HMRC regulations.
• Fund the SSAS
  Your business will need to fund the SSAS through contributions. As the business owner, you can contribute to your own pension, and you can also choose to contribute to your employees’ pensions. Contributions are tax-deductible, helping to reduce your corporation tax.
• Add Employees to the SSAS
  Once the SSAS is established, you can add employees as members of the scheme. This allows them to start contributing to the SSAS and benefit from the investment flexibility and tax advantages.
• Choose Investment Options
  As a business owner, you have control over the investments within the SSAS. You can choose to invest in commercial property, shares in the company, or other assets that align with your business goals. You can also work with a financial adviser to ensure the investment strategy is well-diversified and maximises returns for your employees’ pensions.
• Review and Adjust the Plan
  Regularly review the SSAS to ensure it meets the needs of both the business and its employees. Make adjustments to contributions and investment strategies as necessary to keep the plan competitive and aligned with your business goals.

Enhance Your Employee Benefits with SSAS

In today’s competitive business landscape, offering attractive employee benefits is key to attracting and retaining top talent. SSAS pensions provide a flexible, tax-efficient way to not only secure your own retirement but also provide valuable benefits to your employees. By allowing employees to invest in their pensions with the same flexibility as business owners, SSAS creates a shared commitment to the success of the business and can foster greater loyalty and engagement within the workforce.

If you’re ready to explore how SSAS can enhance your employee benefits package and help your business grow, book a consultation with Retirement Capital today. Our team of experts can guide you through the process of setting up SSAS and tailoring it to suit your business and employees’ needs.