Frequently asked questions

From £25,000 up to £500,000, and never more than half the value of the directors' pension fund when the loan is made. Our average business loan granted in the last 12 months is £115,000. See loan amounts for repayments at each size.

Yes. The rate is 5.00% for the life of the loan. The rules set a minimum rate, so we confirm 5.00% meets it on the day the loan is drawn.

In equal monthly payments over up to five years. Each payment covers the interest and part of the loan.

Yes. There are no early repayment charges.

Interest is 5.00% a year, fixed. The loan fee is £995 per loan, or 1% of the purchase price for a property purchase. You will also need a holding account, which costs £295 a month in years 1 and 2, reduced to £195 a month thereafter. There are no early repayment charges. All fees are confirmed in writing before you proceed. See what it costs.

Any genuine business purpose of the company. See loan uses for common examples. It cannot be passed on to directors personally.

Yes. A pension fund can make more than one loan to the company, as long as the total outstanding stays within half the pension fund's value.

UK limited companies whose directors have paid into a pension, now or in the past. Old workplace pensions count. Sole traders, partnerships and limited liability partnerships (LLPs) cannot use this type of loan.

The lender is the directors' own pension fund, not a bank. The directors control the pension fund, so they decide whether to lend. They still need to be satisfied the company can repay, but there is no external credit search.

Yes. We set up the pension fund, register it with the regulatory authorities and move your existing pensions into it. Registration can take several weeks, so it is worth starting early.

If you already have a pension fund with funds in it, the loan can be arranged once the paperwork and security are in place. If the pension fund needs setting up, allow for regulatory registration and moving your pensions across first. We give you a timeline at the start.

Every loan must be secured against something worth at least the loan plus interest. We use a charge over the company's assets or the directors' shares.

Yes. As well as the debenture or share charge, the directors give a personal guarantee.

Talk to us straight away. Missed repayments can lead to regulatory tax charges on the pension fund, so the directors running it must act. The rules allow limited options in genuine cases, and we will take you through them.

The loan is secured, but as with any lending, if the company fails the pension fund may not recover the full amount. That is why the rules limit a loan to half the pension fund's value. Directors should weigh this before lending.

Interest paid by a company on a genuine business loan is generally a deductible expense for Corporation Tax. The interest is paid into your own pension fund, where it grows free of tax. A specialist can talk you through the position for your company.

No. This is a loan to your company, not a regulated personal loan. We are registered with HMRC to administer occupational pension funds in the UK, and we do not give regulated financial advice.