Due to changes in legislation, you can now put in place valuable life cover for your family in a very tax efficient manner. To benefit from these tax breaks you can also review cover you may already have in place.
So long as your business is a limited company it can put in place a Relevant Life Plan for a Director or Employee. This would pay out a tax free lump sum to your family in the event of death or terminal illness.
The key benefits when compared with normal life cover are that:
- In most cases premiums qualify for full income tax relief, national insurance relief, and corporation tax relief.
- Although the business pays the premium, the lump sum will be paid direct to your family, and the premiums are not classed as a benefit in kind.
- The tax efficiency of these plans means that savings could amount to 40% for a basic rate taxpayer, and 49% for a higher rate taxpayer.
- The benefits payable will not count towards your pension lifetime allowance.
In addition to these tax changes, the cost of life cover has generally reduced in recent years.
To make sure that your family is protected, to review your existing cover, or to make sure you are not paying more than you need to, call Duncan or Sally on 01925 210 000 for an obligation free chat.
