Trust fully in your Life Insurance with The Beneficial Trust

Life Insurance for Business Owners

Avoid 40% Inheritance Tax and pay no Income Tax or National Insurance on your own personal life insurance via your business.

A major benefit of being a business owner is the ability to obtain personal life cover tax-efficiently through the company.

This type of cover, called ‘relevant life insurance’, provides the owners, directors and employees of a small business with important life cover that offers financial protection to their families in the event of death. 

As the premiums are paid through the business it can help to save tax. 

And as it is a requirement that a ‘relevant life insurance’ policy is written in trust it can also avoid (or minimise) 40% inheritance tax (IHT) on your whole estate.

In addition, it can avoid the probate process altogether, which could otherwise delay payment to your beneficiaries for up to 9 months, sometimes much longer.

FREE Health Check on your existing life insurance?

Your existing life insurance could be seriously out of date for many reasons such as a new home, job, marriage, children etc.

We can offer free advice in this respect as well as how to place your policy into trust at no cost.

A 5-minute conversation with one of our Professional Advisors can put your mind at rest.

Don’t currently have life insurance?

We can still offer free advice on what cover we think you should have. If you decide to proceed, we can again place this into trust at no cost.

Did you know that Life Insurance can cost you from as little as £6 per month?

Are you a business owner?

We could arrange life insurance for you via your business.

As well as avoiding 40% IHT it will also be classed as a tax deductible business expense.

This arrangement could be made available as a benefit to your employees as well.

Simply Register Your Interest Today

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NOTE: Registering allows us update you on your journey with us. Your information can be deleted at any time. Our recommended Financial Advisors agree to abide by the same terms and conditions, and will not use your information for purposes other than those clearly stated at the point of their collection or in their own clearly identified Terms & Conditions section

What is relevant life insurance?

A relevant life insurance policy is applied and paid for by the business with the employee or director is the life assured. The policy is written into trust so it pays out the benefit into the trust for the employee’s beneficiaries if the employee dies or is diagnosed with a terminal illness during the term of the policy.

In most cases, the cost of the insurance, paid by the company, is deemed to be an ‘allowable business expense’. If this is the case then the cost of the insurance will become part of the employee’s overall remuneration package.  

Relevant Life insurance is Tax Efficient for:

The Employee:

Although the premiums are paid for by the business, the premiums are not treated as a benefit-in-kind so no Income Tax or National Insurance on the insurance is payable for the premiums paid on their behalf. 

Unlike a group death-in-service insurance scheme, a relevant life policy is deemed to be ‘non-registered’ which is important as any claim paid out does not count towards an employee’s pension Lifetime Allowance. If the lifetime allowance is exceeded by pension savings, death in service benefit, or a combination of the two, a tax charge is payable. Relevant life insurance could, therefore, be a viable option for high earning employees affected by the pension lifetime allowance.

Employer:

Providing the local inspector of taxes deems the policy premiums to be ‘wholly and exclusively’ for the purposes of trade, they qualify as an allowable business expense. This, therefore, reduces the business’s corporation tax bill.

Beneficiaries:

As the policy is written into trust, any lump sum is paid into the trust for the beneficiaries and is not liable to Income Tax and usually free from Inheritance Tax. 

Placing a life insurance policy into trust is available for individuals as well as via your business. To learn more about Trusts, Inheritance Tax and Probate click here.

And it can sometimes double up as a Health & Wellness Employee Benefit Scheme

Some insurance providers provide additional health and wellness related benefits that can be made available to both you and your employees which, from research, has shown increase productivity, morale and reduce sickness days. 

More and more research has showing that companies who invest in implementing healthy habits have a healthy workforce.

The results can help to reduce your costs as well as increasing your productivity.

So it really pays to encourage your employees to be healthy