Relevant Life Insurance
Relevant Life Cover is a life insurance policy offered by your company. It allows companies to offer a death-in-service benefit to its employees (including salaried directors). It’s set up by the company and pays out a tax-free, lump sum on the death (or diagnosis of a terminal illness) of the person insured.
It can help smaller businesses attract and retain high-calibre staff by offering them attractive benefits packages that are also tax efficient. It can also be a tax-efficient way for shareholder directors to take out life insurance.
There can be tax benefits for both the employer and employee.
• Corporation tax relief (so long as the premiums are wholly and exclusively for the purposes of the business); and
• No National Insurance contributions to pay on the policy payments paid to fund the Relevant Life policy.
•Attracting and retaining the right staff
• No National Insurance contributions to pay on the policy payments paid to fund the Relevant Life policy;
• The policy payments won’t be taxed as a benefit in kind; and
• Policy payments and benefits don’t count towards annual or lifetime pension allowances.
With great benefits, this policy offers peace of mind for both the employer and employee.
All businesses should consider relevant life insurance for their staff and Directors, it is a great way to attract and keep good staff and is a tax efficient way of offering benefits for such an important insurance.