Business Owners
Co Director / Partner Insurance
The sudden death of a company Director or business Partner can have very negative consequences on the Business. The deceased’s shareholding becomes the property of their Estate and Family, resulting in new issues. The surviving members may now have a new business partner, unfamiliar with the business. Depending on the percentage owned, there could be transfer or loss of control. Alternatively, the Estate and Family may look to the remaining owners to purchase that shareholding or otherwise look to sell to a competitor. This could deplete important cash reserves or require the remaining Directors / Partners to have to take out new lending to bring an additional burden.
Co Director / Partner Insurance pays a cash lump sum, allowing the remaining owners to buy the shares from the deceased’s next of kin. This brings financial stability to the business, allowing the remaining owners to keep control. There is also the comfort in knowing that were anything to happen to you, you know resources are in place to make sure your family will be properly compensated. This cover has the dual effect of protecting the business and your family too.
Corporate Savings & Investments
Against the backdrop of zero bank interest plus the effects of increased inflation, the value of surplus cash on deposit will continue to be eroded. It is relentless and will continue to eat into the value of cash year on year until you address the matter. By way of simple example, €50,000 on deposit against just 3% inflation per annum, will reduce to €43,130 in real terms after 5 years. After 10 years it will have fallen to €37,205.
Any cash deposits surplus to needs can be put to work. At the very least, you should target inflation and costs, always looking to grow beyond this again. When considering your options, we will look at your time horizon, your risk profile, what access you might need to the capital at any time amongst other matters.
A well diversified portfolio for your surplus cash can include a mix of equities, bonds, cash alternatives, property and more. Put your surplus cash to work, don’t leave it with your bank to their benefit where it will continue to fall in value.
Pensions
We primarily look to pensions to provide a replacement income in retirement. If you are a business owner though, there are other advantages. A pension offers one of the most tax efficient ways to extract money from your own business for your own benefit.
Whether you operate through a Limited Company or Sole Trader, all contributions made by the business on your behalf are tax deductible – there are no benefit-in-kind implications. You reduce your business taxes, you get tax-free investment growth, plus a tax-free cash lump sum at maturity and an increased income once you finish working.
Your business provides for you during your working life. Use a pension as another vehicle to extract extra value from your business for your own benefit, while also reducing your annual tax bill.
It is not just a pension, it reduces your taxes while extracting further value for you personally.
