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As far as the Inland Revenue are concerned the sole purpose for any pension scheme is to provide a pension for its members. All activities of the scheme must have this in mind.
In practice the Pensioneer trustee will need to approve any actions, and they will refer to the Inland Revenue in cases where their agreement is needed or advisable. ( E.g. for potential liquidity problems in property purchase ).
The main implications are :-
The SSAS cannot operate as a business, even by proxy. ( No wholly owned subsidiaries etc.).
Not a cast iron rule, but exceptions are rare, and need approval. ( The only commonly allowed asset of this type is non income producing land, and then only if it can be shown that income will be produced within a reasonable period of time. For example it is planned to develop the land and rent out the premises).
This can cause problems if trustees wish to invest the SSAS funds in a property only a few years before one of the members will need funds on which to retire. The Revenue will want to be satisfied that funds will able for the members pension. Seek advice.
No loans to members. No buying houses, works of art, boats ( for "hospitality" ). Nothing that could give rise to a "benefit in kind" or "pride in possession". Anything that could be described as a "cunning plan" should be viewed with great caution.
If a member leaves and a transfer value is required it must be produced. Bear this in mind when considering anything with liquidity implications, ( such as property purchase, or tying up a high proportion of investment in a loan ). In case you skimmed the last sentence read it again. Imagine what would happen if you spent the fund on a property, and then your partner left and asked for a transfer. They could force asset sales to realise their funds. It can get nasty.
No deals with members or connected persons, to buy from, sell to, lease etc. If an investment has been owned in the past by a member or connected person then three years must elapse before the scheme can purchase. Likewise if an asset is sold by the scheme any member or connected person must wait three years before buying.
If in doubt, or even if sure, consult the advisers.
The SSAS is protected from creditors in the normal run of business, even if the company folds. The exceptions are if the failure is considered to be fraudulent or creditors can argue that funds were transferred to the SSAS in order to prevent the creditors getting hold of them, in which circumstances protection may be lost. If your company is facing difficult times and you want to invest, get good legal advice to ensure correct action.
A technical breach which does not benefit, or potentially benefit a member or connected person, may not have a significant impact, although it would send a warning to the Inland Revenue that controls are not perfect, and may encourage their closer study of your other activities.
If however the breach was of a nature that allowed a member or connected person to benefit, or potentially benefit, then expect some or all of the following:-
The scheme will lose its tax exempt, (and creditor protected) status, possibly backdated. This will result in the scheme being subject to tax, in the contributions tax relief being reclaimed, and interest charged.
This can cause bankruptcy of the scheme, the company , and even the trustees.
Do not expect to be able to plead ignorance, or negotiate with the authorities. They know that a SSAS is a superb tool for directors, and hit hard at anyone who abuses their generosity, especially since in correctly run scheme such abuse is impossible. They show no mercy.