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Transfer 2nd property to pension

  • 18-08-2019 7:46pm
    #1
    [Deleted User]
    Posts: 0 ✭


    Hi All

    I have a second property that is a holiday house. Well it was my first property that i ended up living in for about a year and a half and bought mortgage free. With work location i bought a new house with a mortgage on it.
    I used the holiday house most weekends but now the attraction is dwindling.

    I am trying to decide whether to rent as a lot of the houses are now residences with owner occupiers or sell up.

    Another thought that has entered my mind is whether i could set up a self administered pension and transfer the property over to the pension as a personal loan to the fund. I could use the current balance as a down payment and then make payments over the next 6 years until the loan is cleared and then the pension would own the property. I would look at giving the property to the local holiday letting company (all depending on how much the average payout to the fund would be) as it would be less hassle to manage.

    Is this possible to do? has anyone else done similar?

    Thanks in advance


Comments

  • #2
    Fol20
    Registered Users, Registered Users 2 Posts: 3,627 ✭✭✭Fol20


    You can’t do the above.

    You need to be at arms length from the property and although I understand you won’t be managing it yourself. You also need to buy the property originally from a third party also and not transfer it unfortunately.

    I would also look into potential new proposals for self admin pensions as the legal work behind them may increase which may make them uneconomical to run in the future. This is not confirm yet but there is talks where admin fees may increase by 5+pc


  • #3
    DubCount
    Registered Users, Registered Users 2 Posts: 1,094 ✭✭✭DubCount


    This is really a situation requiring the advice of a professional investment advisor.

    As far as I am aware a Self Administered Pension Scheme cannot purchase or rent property from the beneficiary of the scheme. There are further anti-avoidance provisions relating to transferring the property to a company first etc. There are also capital gains tax implications as you can only claim principal private residence exemption on one property. I don't think what you suggest is possible, and if it is, its not straight forward.


  • #4
    whatnext
    Registered Users, Registered Users 2 Posts: 916 ✭✭✭whatnext


    In rough terms the advice I was given some time ago is that you can’t transfer a property into your pension. It is in principle possible for your pension fund to acquire a property but the complexities of it just turned me off looking into it further. Things like setting up a legal entity to be the legal owners and many other complexities took all the good out of it.


  • #5
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    Thanks for the replies, i got the property valued when it was no longer my principle dwelling. I'll probably end up just selling it then. Its an idea that popped into my head that if i got it valued and compared with other similar transactions that it would be better as a pension earner than getting all the cash now.

    Nothing is easy


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