Tax Free Life Cover
for construction industry directors
- YOUR FAMILY LIFE COVER PAID BY YOUR LIMITED COMPANY
- FULLY HMRC APPROVED
- UP TO 35 TIMES GROSS ANNUAL EARNINGS
- PROTECTION FOR DIRECTORS AND EMPLOYEES
- PREMIUMS CORPORATION TAX DEDUCTIBLE
- NO N.I. AND NO P11D BENEFIT IN KIND
- TAX FREE LUMP SUM PAID TO YOUR LOVED ONES
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what is relevant life insurance?
Relevant Life Insurance is a tax-free way of providing the loved ones of a Director/Employee with a cash lump sum in the event of their death.
It is effectively an individual Death-in-Service benefit and can benefit specified Directors/Employees of Limited Companies.
Premiums are paid by the Company, but the policy is placed in a Trust which ensures that, in the event of death, the chosen beneficiaries receive a tax-free cash lump sum without lengthy probate delays.
Substantial levels of cover are available based on multiples of the Director/Employee’s annual remuneration.
Relevant Life Insurance is HMRC approved*
* It must meet legislative requirements so that the plan can qualify for certain tax benefits. (Directors must be employed in their Limited Company)
HOW DOES RELEVANT LIFE COVER WORK?
As with a personal life insurance policy, the premium is based on a number of factors:
Age
Smoker status
Sum insured
Financial information
Medical & lifestyle information
Term of cover
Cover is available to a maximum age of 75 years. Sum insured can be up to 35 times annual remuneration dependant on age. If the insured Director/Employee dies during the term of the cover, a tax- free lump sum is paid to their chosen loved ones.
If the Director/Employee leaves the Company, or the business is sold, the policy can be transferred into the individual’s name, and life cover continued, as long as premiums are maintained.
RELEVANT LIFE features
Family life cover paid by the Limited Company
Premiums are Corporation Tax Deductible
No NI cost / No P11D benefit in kind
Benefits don’t count toward pensions annual or lifetime allowances
No Inheritance Tax Liability
Cover placed in Trust to chosen Beneficiaries
HMRC approved and recognised
Maximum age at expiry of cover 75 years
personal policy & relevant life plan comparison
COMPARING THE REAL COST OF A PERSONAL LIFE POLICY TO A TAX-FREE RELEVANT LIFE PLAN FOR A SALARIED DIRECTOR/EMPLOYEE *
| personal life policy | relevant life policy | |
|---|---|---|
|
Annual Premiums Premiums can be paid monthly |
£1000 | £1000 |
|
Employee NI National Insurance (assuming 2%) |
£34.48 | £0.00 |
|
Employee Tax Income Tax (ASSUMING 40%) |
£689.65 | £0.00 |
|
EMPLOYER NI National Insurance (ASSUMING 13.8%) |
£237.93 | £0.00 |
|
EMPLOYER TAX CORPORATION TAX (ASSUMING 19%) |
-£372.79 | -£190.00 |
| total cost | £1589.27 | £810.00 |
A SAVING OF £779.27 –ALMOST 50%.
*Source Legal & General 2019 using Corporation Tax Rate at April 2021.
RELEVANT LIFE IS CORPORATION TAX DEDUCTIBLE – NO P11D BENEFIT IN KIND CHARGE TO THE EMPLOYEE.
about what life
The Directors of What Life jointly have over 60 years’ experience in the Financial Services market.
Our Business Life insurance clients are dealt with exclusively by the senior management of What Life who are specialists in these products, and can also advise on Key Person cover, Shareholder Protection and Business Loan protection.
No fee is charged for our advice and we are remunerated by our product providers only once a successful application has been made and cover secured.
At What Life we pride ourselves in giving first class administrative support for clients throughout their application and we help to make the process as efficient and speedy as it can be.
We work with a panel of the UK’s leading life insurers to find the best possible products for each application.
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get a quote for tax free life cover
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Or call us on 0800 009 6810 and we’ll be happy to help.