Going overdrawn?

My client's balance sheet shows capital account of £50 000 and current account of £200 000 (total £250 000). This is represented by freehold property of £150 000 and current assets of £100 000 (total £250 000).

It has been suggested that my client should refinance the business by taking out a loan to repay his current account. Once this has been achieved it is also suggested that the property could be transferred to a self invested personal pension (SIPP) such transfer to be treated as a pension contribution on which relief would be claimed.

The first part of the scheme would not appear to me to cause problems provided the capital account does not become overdrawn. I am concerned that the transfer of the property at a later date would cause the capital account to become overdrawn to the tune of £100 000 and that...