Presentation on theme: "1 VITALITY.CO.UK/LIFE Introducing Relevant Life Policies."— Presentation transcript:
1 VITALITY.CO.UK/LIFE Introducing Relevant Life Policies
2 WHAT IS A RELEVANT LIFE POLICY? Life cover only Employer sponsored Single life assured No surrender value Policy ends before age 75 Benefits in trust created at outset (for an individual or charity) Not part of employees annual pension or lifetime allowance Main purpose of the policy must not be tax avoidance Defined in Income Tax (Earnings and Pensions) Act 2003
3 THE OPPORTUNITY A great employee benefits package for SMEs with low buying power to provide employee benefits SMEs that are too small for ‘death in service’ benefits Company directors looking to save on tax Flexible cover - reward specified employees or provide variable cover High earners – Relevant Life Policies do not count towards Lifetime Allowance Which of your corporate clients: Would like to reward their top employees? Would like to be able to offer a benefit to retain their top people? Would like to make their recruitment package more attractive? 4.85 million SMEs in the UK
4 WHO ELSE CAN BENEFIT? Company directors Directors of limited companies can enjoy valuable tax benefits if the premiums for life insurance are paid by one company instead of from personal income after tax. Flexible cover A Relevant Life Policy can provide individually calculated cover levels so are suitable where companies only want to reward several employees or provide variable cover. High earners The benefits of Relevant Life Polices do not count towards the current Lifetime Allowance of £1.25 million, above which tax is currently charged at 55% tax (on death). A Relevant Life Policy is suitable in many situations, not just SMEs looking for life cover or an employee benefits package
5 BIG BUSINESS BENEFITS FOR SMALL BUSINESSES Relevant Life Policies from VitalityLife allow you the chance to offer your clients a benefits package for their employees. Not only does that help with recruitment and retention but healthy employees are: more engaged take less time off more productive On top of all that, if your clients take out Vitality Plus or Vitality Optimiser, they can also get cashback (based on how much their employees engage with Vitality).
6 VITALITY PLUS AND OPTIMISER CLIENT BENEFITS Tax efficient – a tax deductible business expense and no National Insurance contributions A great employee benefit for small businesses, life cover and a healthy living rewards programme that can help attract and retain the best people More affordable cover – An upfront discount on the protection premium of between 5 – 20% for fixed term cover with Vitality Optimiser Your clients could receive up to £100 cashback each year with Vitality Plus or Vitality Optimiser depending on how much their employees engage with Vitality Fitter, healthier, more engaged employees that take less time off and are more productive Available to companies of all sizes on an individual basis Can be used as a ‘top-up’ to death in service benefit Clients can save nearly 50% tax (compared to an ordinary Life Policy) when they take out a Relevant Life Policy with VitalityLife.
7 BENEFITS FOR YOUR CLIENTS EMPLOYEES Cash lump sum payment for terminal illness as well as death Reward your client’s employees with our healthy living rewards programme Access to a range of discounts and rewards to encourage your client’s employees to look after their health Tax efficient – no National Insurance contributions On payout, the cash lump sum is not subject to Income Tax or Inheritance Tax. If they leave the company, we’ll make it easy for them to take the policy with them, so they can ensure their cover continues It doesn’t count as a retirement benefit so won’t affect their Lifetime Pension Allowance
VITALITY.CO.UK/LIFE 8 Discounts and Rewards with VitalityLife Monthly cost Upfront discount Cashback for employer each year Premium discount for employer each year Discounts and savings for employees Additional rewards for employees including 50% off monthly gym fees and a cinema ticket every week Healthier, fitter, more engaged and more productive employees Vitality Optimiser£3.30* Vitality Plus£4.50* VitalityFREE *prices applicable from 1 st February 2015
VITALITY.CO.UK/LIFE 9 Vitality: incentivising behavioural change Reward and discount partners Vitality Plus and Vitality Optimiser partners
VITALITY.CO.UK/LIFE 10 Tax saving example This example is for illustrative purposes only and is based on VitalityLife’s understanding of the law and HM Revenue & Customs practice as at December 2014.
VITALITY.CO.UK/LIFE 11 Relevant Life Policy in contrast Relevant Life Policy Death in ServicePersonal Cover Variable cover per life assured YNY Minimum members151 Individual applications YNY Employer sponsored employee benefit YYN Tax efficient employer/employee YYN Online applicationYNY Medical free limitsNYN
12 THREE CONTINUATION OPTIONS Replacement policy - replace with a personal protection policy (if not yet reached 65th birthday) Corporate - taken over by new employer (no age limit) Personal - personally take over the policy on the same terms and conditions (no age limit) All without further underwriting…
13 Relative size of market for each need DOCUMENTATION Mandatory requirements Application and trust form Recommended Appointment of additional trustees Expression of wishes document Scotland only: Mandatory requirements Application and trust form Appointment of additional trustees Recommended Expression of wishes document
14 SOME THINGS YOU NEED TO KNOW… ‘Remuneration’ defined as: Salary Bonuses Dividends; and P11d benefits Eligible - if ‘Schedule E’ taxpayer An employee of a: Sole trader Partnership LLP Limited company A shareholding director employed by a limited company Ineligible - if not ‘Schedule E’ taxpayer A sole trader An equity partner An LLP member
15 OUR STREGTHS Online application and editable trusts Indexation option available High cover limits – up to 15 or 20 times remuneration (dependent on age) Three continuation options, all without further underwriting Tax savings calculator Avelo Exchange, Assureweb & Webline portals Large case underwriting assistance Local and specialist support
VITALITY.CO.UK/LIFE 16 RLP Tax Saving Calculator Vitality for Business pitchbook RLP with Vitality technical article RLP FAQs RLP pitchbook RLP client sales aid RLP tax-saving sales aid RLP letter templates RLP Adviser and Client Guides Business Protection client sales aid RLP application form Vitality Calculator Our Relevant Life Policy literature and tools