Case History

How Mr. Smith can buy a £240k Himmapan suite for a net outlay of £120k.

Mr. Smith is a successful property investor and has UK earnings in excess of £250,000 per annum. He decides to invest in an “off-plan” Himmapan two bed suite for a total purchase price of £240,000 payable over the life of the build.

He already has a small pension of £40,000 with Scottish Amicable which converts to a SIPP. In the tax year 2007-2008 he makes a single net contribution of £60,000 which attracts tax relief of 40%, resulting in £100,000 being placed into the SIPP.

Mr. Smith’s fund now stands at £140,000 which enables him to make the payments due for his Himmapan Suite up to April 5th 2008.

In the 2008-2009 tax year Mr. Smith makes a further contribution of £60,000 on which he receives a further £40,000 tax relief. He now has sufficient funds within his SIPP to complete on the purchase of his Himmapan Hotel Suite by 2009.

With his transfer from Scottish Amicable of £40,000 and his tax rebates of £80,000 Mr. Smith has been able to purchase a Himmapan unit for a net outlay of £120,000.