Relevant life cover is a type of life insurance policy taken out by a company for the benefit of an individual employee. The premiums are paid by the company and treated as an allowable business expense — unlike personal life insurance, the premiums don't attract income tax, National Insurance, or count as a benefit-in-kind. We'll match you with a specialist adviser.
Key tax benefits
- Corporation tax relief — premiums are an allowable business expense
- No P11D benefit — the employee doesn't pay income tax on the premiums
- No employer's NI — the company doesn't pay employer's National Insurance on the premiums
- Written in trust — payouts are typically outside the estate for inheritance tax purposes
Who is relevant life cover for?
- Limited company directors wanting tax-efficient life cover
- Higher or additional rate taxpayers who want to maximise savings
- Business owners who want to protect their families while minimising company costs
- Employees whose employer wants to offer life insurance as a benefit
How it compares to personal life insurance
For a higher-rate taxpayer, relevant life cover can effectively reduce the cost of life insurance significantly compared to paying personally. The company pays the premiums before corporation tax, and there's no personal tax charge — making it one of the most tax-efficient ways to hold life cover.
What you might need to hand
- Details of your company structure and directorship
- Your current personal life insurance arrangements
- Details of any existing group life or death-in-service schemes