Once in a SIPP a property is not as inflexible as you might think. Other than an investment decision to sell a property, there are normally two other key times when the state of the property would be considered – taking benefits or death. In both cases if the property is co-owned with another party, the remaining co-investors will have the right to buy the share of the outgoing member at fair value or indeed to introduce another investor into the syndicate to do so.

Taking benefits
Should you wish to purchase an annuity then as with all other assets the property would have to be sold. No capital gains tax would be payable on any appreciation in value. If however you choose to take unsecured income (UI) or an alternatively secured pension (ASP) then there may not be any requirement to dispose of the property.

Death
Upon death either pre-retirement or post, then as the administrator we have the right to sell the property in order to convert it to cash to pay your beneficiaries. However this is not always appropriate and it may be possible to transfer the ownership of the property interest to your beneficiaries.