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June 28, 2021

A simple way to save on your life insurance


in Financial Planning Insights

If you are a Director of a limited company and you are paying your life cover premiums personally you are likely to get much greater value exploring the possibility of paying the premiums through your company, i.e. relevant life insurance.

An individual will buy personal life insurance out of their net income, after both tax and National Insurance contributions (both employer and employee) have been paid.

Not so with relevant life plans. With these, HMRC usually allows premiums to be deducted as a business expense, saving the company corporation tax. There is also no employer or employee National Insurance to pay on the premiums. These savings combine to ensure that relevant life cover is often significantly cheaper than a policy paid for by an individual. It can therefore offer a company director considerable savings at both the personal and corporate level.

If you want us to run through the numbers and the likely savings then the best way to proceed is to contact a specialist adviser to ensure that relevant life insurance is right for you.

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