This is an insurance policy that a company takes out to provide a ‘death in service’ benefit to employees. It is a very tax efficient way of paying for any life insurance that you may need – especially if you are a higher rate tax payer.
For example, if you currently pay £50 a month for life insurance personally here’s what’s happening with tax behind the scenes:
|Available for dividends||£74|
|Higher rate tax||£24|
|What you’re left with||£50|
If the company takes out a Relevant Life policy instead then the company would pay the £50 cost and get corporation tax relief too. This means the real cost to the company is just £40. You’re getting a tax saving of £51 every month on a policy only costing £50 to begin with. And with many life policies running for a long time you could save over £12,000 over 20 years.
Here’s a few final points:
To discuss how a Relevant Life policy could work for your company then please get in touch.
The first step in working together with us is to book a 15 minute Discovery Call with one of our Client Coordinators to find out whether we'll be a good fit for you and your business.Book a Discovery Call
Give us a referral and we will donate a goat to a family in AfricaFind out more