Employers are unaware of how inexpensive it can be to provide employees with life cover to protect their family from financial hardship, should one of your employees die whilst under your employment.
Any employer that has had to attend the funeral of a member of staff that was not provided with such protection will know the feeling all too well. Do not beat yourself up too much though as you are not alone, in fact you are in the majority.
Historically Group Life was automatically provided alongside a company pension scheme, however it is not an obligatory requirement under Auto-Enrolment so introducing it into your employee benefit package can immediately set you apart from your competitors, but at a fraction of the cost of providing a Workplace Pension.
Plus it is a fully tax deductible business expense and not a taxable (P11D) benefit for the individual that is provided with the cover. It is a statistical fact that a happy workforce is more stable and productive.
‘Group Life’ is essentially a Death in Service benefit that is both straightforward to set up and inexpensive to run, yet the benefit it provides engenders a feeling from both your employees and their families that you are a caring business, which in turn embeds greater loyalty and productivity.
For a free no obligation whole of market quotation, please provide your details here so we can provide you with a data capture form to capture the minimum details required to tender the market and make a provider recommendation.
Relevant Life Policies
This seems to be one of the best kept secrets in the market, but did you know that it is possible to obtain up to 60% tax savings on an individual life assurance policy? The government are allowing companies to provide individual policies, which are treated in a similar way to Group Life with regards to taxation, but apply to individual policies.
This type of policy is the most suitable arrangement for providing benefit a form of ‘Death in Service’ to higher earners, for what sets them apart from Group Life is the Sum Assured does not form part of the individuals Pension Lifetime Allowance.
By way of example, for someone earning £150K per annum who was provided with Death-in-Service of 4 times salary, they would lose £600K of their Pension Lifetime Allowance. This does not apply however to Relevant Life Policies.
It is an allowable business expense against Corporation Tax
It is not a ‘benefit in kind’ and therefore the employee is not subject to Income Tax
The Sum Assured does not from part of the an individual’s Pension Lifetime Allowance
As it is payable through a discretionary trust, the sum assured does not form part of the employee’s estate
Depending on your company’s Corporation Tax rates and your employees Income Tax rates, the net saving can be as much as 60%.
Who is it suitable for?
Company Directors and key employees/high earners
Individuals trading through a Limited Company
Companies with a small number of employees that are too small to implement group life
Retention and recruitment of senior staff
Employees with a large pension fund that may exceed Lifetime Allowance
It’s available to companies of all sizes and on an individual basis which means that you can now offer different benefits to different employees. And, just like a ‘death in service’ benefit, it will pay a lump sum in the event of the death of an employee you choose to cover. To obtain a quotation or for further information about Group Life Plans and Relevant Life Policies, please contact us.