RELEVANT LIFE POLICIES – PROTECTION OPTIONS FOR KEY EMPLOYEE’S

RELEVANT LIFE POLICIES – PROTECTION OPTIONS FOR KEY EMPLOYEE’S

A stand-alone single life policy is an alternative way for employers to provide death-in-service benefits to their employees.

The policy provides a lump sum benefit on the death of

an employee outside of a registered group life scheme.

What are the benefits?

• The benefit won’t form part of the employee’s lifetime

pension allowance.

• The payments made won’t form part of the

employee’s annual allowance.

• The payments employers make aren’t subject to

income tax because they’re not normally assessable

on the employee as a benefit in kind.

• These payments can be treated as an allowable

expense for the employer in calculating their tax

liability, as long as the local inspector of taxes is

satisfied they qualify under the ‘wholly and

exclusively’ rules.

• In most cases the benefits are paid free of

inheritance tax – provided the benefits are payable

through a discretionary trust.

How do I apply for a relevant life policy?

You can apply for a relevant life policy using our experience and resources. The plan must be written on a ‘life of another’ basis with the employer as the plan owner and the employee the person covered.