Protecting Your Business
While helping clients plan for their retirement; we also offer what we feel is valuable advice on protecting the source of their families’ income. Once you have navigated the seemingly complex world of company pension solutions and you have a structured and clear retirement plan in place, the next step is to consider how to protect this wealth, your business and your family, through business protection.
Just as in relation to your personal financial affairs, it is It is always good practice to consider the risks that your businesses face.
The most valuable assets a business has are its owners and its employees. Around 98% of companies in Ireland are in the Small Medium Enterprises (SME) sector with 2 or more owners (source: Central Statistics Office).
Have you ever considered the impact the death of a key employee or shareholder, even yourself, on the future sustainability of your business?
- How will the business survive?
- What will happen to your shareholding?
- Will family members be welcome in the business?
- Have key employees made plans for their own families – how will they survive financially?
- What do you want to happen to their equity and the future control of the business?
Arranging structured Business Protection is an effective way to ensure that the necessary funds will end up in the right hands at the right time, in a cost-efficient manner, to ensure the continuity and the survival of your business.
There are a number of different Business Protection arrangements that can be put in place:
Personal Shareholder Protection
This allows the shareholders of a limited company to provide funds to purchase the share of a deceased shareholder from their personal representatives. The life assurance contracts are taken out by the shareholders personally. This ensures the surviving shareholders retain control of their business.
Corporate Shareholder Protection
This is an arrangement whereby the company agrees with each shareholder to buy back his / her shares from his / her personal representatives on death, with the insurance cost being borne by the company. This ensures security for the company, and peace of mind for the family / dependants of the deceased.
Keyperson Cover
This allows a limited company to plan for the potential financial loss that it would suffer on the death or serious illness of a key employee. For example, will any loans to the business have to be repaid on the death of a specific individual?
Gift or Inheritance Tax Planning
This allows you to plan in advance for any tax liability which could arise on the transfer of a business, thus ensuring the business won’t have to be sold off to pay the tax debts.
Your company’s circumstances will determine which business protection option meets your needs, but whichever route you chose, it’s simply about putting life cover in place to ensure that the necessary funds will end up in the right hands at the right time. This short video explains how it works.
We are here to provide straightforward Business Protection advice, to give you peace of mind that your business and your family are protected if the worst happens.
Talk to Harvest on 01-2375500 or email justask@harvestfinancial.ie and we will be delighted to assist.
Income Protection