RPSM07300100 - Scheme Administrator Pages: Investment: Can a registered pension scheme invest in shares of the employer?

Can a registered pension scheme invest in shares of the employer?

A registered pension scheme is free to buy quoted or unquoted shares; generally the only restrictions that apply relate to the purchase of shares in the sponsoring employer (see RPSM07105020).

An occupational scheme that is a registered scheme can buy shares in a sponsoring employer provided that the amount used for this purpose is less than 5% of the net fund value as at the date of the transaction. If there is more than one employer, the 5% limit can be applied to all of them individually provided that the total invested is less than 20% of the fund. The scheme could own 100% of the shares in one employer provided that the cost of them equates to less than 5% of the net fund value. These limits would not apply to a scheme that is not an occupational scheme as there is no sponsoring employer and therefore no limit on share purchase.