protect your family tax efficiently

Protect your loved ones, tax efficiently

Posted on 29th August 2018 by

Those that make the decision to work for themselves and run their own limited company usually do so because it allows for a lifestyle that best provides for, and protects, their family and loved ones. Both admirable and desirable incentives.

However, one of the challenges that comes from working for yourself, is that you no longer enjoy the benefits that an employer provides. Benefits like sick pay, pension contributions and protection from legal liabilities. Beyond your salary, it’s these benefits that enable you to provide for and protect your loved ones in every circumstance.

Protection for Company Directors and Contractors

These challenges can be overcome however by ensuring that you and your business are adequately protected with Critical Illness cover, Income Protection, Indemnity Insurance and Public Liability Insurance, as well as by contributing to a suitable pension scheme.

When it comes to Life Insurance however, there is a benefit that limited company Directors and Contractors are able to receive.

Ordinarily if you wanted to secure Life Insurance to protect your family, as a Contractor and company Director, you would be paying for the premium out of your own pocket. Paying yourself a salary and then paying for your Life Insurance means that your Life Insurance premium has been subject to income tax, employee national insurance contribution, employers national insurance contribution and corporation tax relief. Essentially, it’s more costly than it should be.

The tax efficient Life Insurance solution

Relevant Life Insurance however offers tax efficient advantages to company Directors and Contractors looking to secure themself with life insurance.

With a Relevant Life Insurance policy you pay for your life insurance through your business as opposed to from your salary. This means that the premium is not subject to national insurance contributions or income tax and, you still benefit from the 19% corporation tax relief.


relevant life insurance

You can look after your loved ones with relevant life insurance

Further benefits of Relevant Life Insurance

More than these direct financial savings through tax efficiency, Relevant Life Insurance has further benefits:

  1. The policy will be set up through a discretionary trust which means that the payout on a claim, if you die, will reach your family as quickly as possible and normally free of inheritance tax
  2. There is no benefit in kind charge
  3. There’s flexibility: if you did return to full time employment, you won’t lose your cover

When it comes to protecting your family and loved ones, there are certain things that make sense to put in place. You want to live with the peace of mind that if the worst was to happen and you were no longer able to provide for them, they are financially protected. Relevant Life Insurance enables this peace of mind while at the same time being tax efficient. Meaning that you can spend the savings you make on your Life Insurance on the people you love.

To find out more about securing yourself tax efficient life insurance, visit here.



The information in this article has not been written by Caunce O’Hara & Co Ltd or any of Caunce O’Hara’s employees. None of the opinions or views contained within this article are Caunce O’Hara’s nor do we accept responsibility for any financial advice given within the article.

Caunce O’Hara & Co Ltd do not provide Life Insurance policies nor advice regarding Life Insurance.

Broadbench’s Relevant Life Expert is authorised and regulated by the Financial Conduct Authority number 590288 in respect of mortgage and insurance mediation activities only. Registered address: 2 Stanley Road, Poole, Dorset. BH15 1QY  The company is registered in the UK, number 07491324.

Related Articles:

It’s not just the mortgage you need to think of when deciding what amount of life cover you need

The Tax Savvy Way to Pay for Life Insurance as a Contractor

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