How your business could protect you

I often wonder why people don’t think it is necessary to protect themselves.  Part of this might be because we all have to see a need or benefit in doing something.  So when it comes to being reluctant to put some protection in place with life cover, the problem is that YOU personally will never see the end benefit.   

What I find as being interesting though, is that people’s perception of life cover changes when they have had a personal connection with someone who has passed away.  A need is identified, the urge to protect becomes all the more real.  

Now I don’t want this article to lead you down a depressive tone for a Friday evening, as the whole point is to put a positive light on something that is not the most enjoyable of topics.  

There is a very old saying which is “there is nothing more certain than death and taxes”, but what if these could be combined together in a positive way?  

I know that you will not benefit from any form of life cover, but your family and love ones are.  No matter what anyone says to me life cover is a fundamental part of someone’s financial planning.  My very strong feeling is that, if you cannot afford to pay for life cover at the very least to pay off your mortgage, then you cannot afford the mortgage.  The reason for this is that if you or your partner were to die, where is the money coming from to keep your family or love ones in their home, at a very traumatic time?  

So if it is down to affordability, this piece of information may help!  I can see you are excited now!  If you own your own limited company and you are an employee of that business or any employee for that matter, a personal life assurance policy can be paid by the company and you get tax relief on it.  What, HMRC are giving us something again.......yes they are. 

The life cover works like a Death in Service plan, but on a smaller scale.  The company owns the policy, you are the life assured, but benefit goes to your family! 

As this is paid for by the company, it is a tax deductible item.  It is not classed as a P11D benefit and as the company does not receive the benefit the money will not be taxed on distribution.  

However, what should be taken into consideration is that it must be “wholly and exclusive” for the purposes of business, but as a valuable member of the company this should not be hard to prove. 

There are substantial numbers of women now running their own businesses and who probably have no idea of this valuable benefit.  Why would you pay tax and NI on something that could be paid for by your company. 

Women are very good at multi tasking, juggling home and work.  You yourself will probably have the household budget and your business budget well under control, but how many times do you think of linking them together?  

With all the hours and energy that you invest into your business, wouldn’t it be nice if that business could put a ‘comfort blanket’ around you?