If you run your own business, then this page is great for you!

It’s equally important if you are self employed that you make sure your business is protected. Often this can be done in a tax-efficient manner.

We can help in the following areas:

·         Keyman cover: do you have certain people who work for you that if they were ill or died your business would suffer financially?

·         Shareholder Protection: are you a limited company with more than one director? What happens to the share capital if one of the directors were to die? For example, would their spouse get a seat on the board? Talk to us about cross-option agreements……

·         Death in Service scheme for the salaried directors: are you a director of a limited company paying your life insurance from your personal bank account? If so, it may be more tax efficient to look at setting up your own Death in Service scheme via a Relevant Life Policy

·         Loan Protection: Do you have any business debts? When you took the commercial loan, did you just do the life insurance through the bank? Contact us to see if we can get you a competitive quote.

For example, the potential situation below illustrates why Shareholder Protection is important for Limited Company Directors:-

Jessica, Henry and David are co-directors of an IT company.

Jessica set the company up initially. It grew very quickly and she decided to reward her two key employees with a stake in the business to help incentivise them and promote further growth.

Jessica now owns 60% of the company with Henry and David owning 20% each.

If Jessica was to die, with no shareholder protection in place, then her husband Jonathan can take his place on the board. This would give Jonathan the control of the company. However Jonathan doesn’t work in IT and has no interest in this.

Plus, Henry and David are uncomfortable at the thought of this happening and the loss of control of their business to Jonathan.

Simple life insurance with a cross option agreement could make this really simple. A life insurance policy is taken out on Louise with Henry and David the effective owners of the policy. The sum assured is for the value of Jessica’s shareholding. In the event of Jessica’s death, then the cross-option agreement means either party (Jonathan OR Henry & David) can initiate a compulsory sale/purchase/transfer of ownership for Jessica’s shares.

This means Jonathan would receive a large sum of money to help replace Jessica’s income and bring up the kids, and Henry and David retain control of their business.

Get in touch to find out how we can help you…

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0208 037 7667