Offering a perk such as tax efficient Relevant Life Cover makes staff feel more appreciated so they’re more likely to stay with your company for longer.
What is Relevant Life Cover?
Relevant Life Cover provides your employees with a death-in-service benefit. Although the company makes the payments, it’s not normally treated as a benefit in kind, so not included in income tax assessments. For a higher rate taxpayer, this could be a significant saving.
A Relevant Life plan will only cover those who take a salary from the business. If you are a sole trader, or a partner, you are not eligible for this type of insurance policy. However, this does not stop you buying regular life insurance out of your own income in the normal way. A Relevant Life Plan policy can be used to cover company directors and those who own their own business, provided it is registered as a company in the UK and they take a PAYE salary from the enterprise.
How does Relevant Life Cover protect your business?
This is a financial safety net for your staff and their families. The policy that’s paid for by the company provides a lump sum for the family, not the business, however finding and keeping the right staff is key to the success of any business. Offering staff perks such as Relevant Life Cover goes a long way to making them feel appreciated and saying with you for longer.
Benefits of Relevant Life Cover
- Unlike most group life schemes which are governed under pension legislation, any pay outs from a relevant life plan do not affect your pension contributions.
- If a director or employee leaves, they can keep the policy going by simply taking over the responsibility for paying the premiums, without needing a new application, medical or underwriting.
- You can insure up to thirty times your earnings, depending on your age and the insurance provider of choice
- Makes staff feel more appreciated and valued which means they are more likely to stay with your business for longer.
Business Continuity Planning
Business continuity planning plays a key part in protecting the stability of your business. It ensures your busines continues to trade if the unexpected happens. Relevant Life Cover is just one area of business protection. You might also want to consider protection for shareholders or partners. Without this type of cover in place, if the shareholder dies their shares could go to someone with no interest in your business, maybe even a competitor. There’s also business debt protection, and tax efficient Key Person Cover to protect your business against the loss of a key person.
Find out more. Download our business continuity guide.
Why choose The Finance Roome?
We understand the complexities of business continuity planning and depending upon whether you’re a sole trader, limited company or partnership, our business protection team can advise you on the most cost-effective options for your business. We listen to your specific needs before searching hundreds of business protection products to find one that matches the individual requirements of your business.
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