Financial Services

The types of financial advice and services that tend to be most important to small businesses fall into 3 main categories:

The Directors and employees of a business may be interested in talking about financial security, so it’s worth thinking about insurance cover for their peace of mind:

Critical illness cover

Will pay out a one-off, sometimes tax-free payment that can be used to support an individual and their family if they get a serious illness and are unable to work.

Life insurance

Cover in the event of a critical accident, illness and death. If you work through a business, life insurance, sometimes called ‘Relevant Life’ can be provided tax efficiently through your business.

Save up to 37% by insuring through your business!*

As the director of a limited company, say your monthly premium for insurance was £30. You could pay this personally or from your company.

Premiums paid personally will be paid from your post tax income. That means that a £30 premium would actually cost you £39.75.

If you made a payment to a relevant life insurance policy from your company, the actual cost of your £30 premium would only be £24.30, saving you over £15 a month. That’s a 37% saving!

Income protection insurance

Should an individual be unable to work because of injury or illness, Income Protection Insurance pays them, usually until retirement, death or your return to work.

There are a variety of tax efficient savings and investment options available to the business and its directors. Some of the areas for discussion include:

Pensions

Pensions are a great tax-efficient saving opportunity for business owners. For example, where someone becomes a director for the first time, they will have to look after their own pension arrangements, as opposed to having this organised by their employer as well as the arrangements for their employees.

Save 54% with a pension!*

Say your company earns £100. You’ll have to pay 19% corporation tax, which brings the amount down to £81. To take this money out of the company, you’ll take home your income through a mixture of salary and dividends. If you took this £81 as a dividend, it’s likely you’ll incur dividend tax of 32.5%. That brings the total amount you take home down to just over £54. Take your pension from here and you’ve lost £46 of your hard-earned cash. However…

Invest the £100 in a pension through your company, you can contribute the whole amount AND receive corporation tax relief.

ISAs

Individual Savings Accounts come in a number of forms and can be a tax efficient long term part of a wealth management plan.

Investments

Depending on your personal circumstances, goals and attitude to risk, there are a number of investment options available, from cost-effective saving schemes to advanced wealth strategies. Good advice can help you make the best plan for your future.

For some small businesses, mortgages can pose a difficulty as some lenders ask for proof of income that sometimes may fluctuate largely. A financial adviser who gets how small businesses operate will be able to source the right mortgage for you with a provider who understands your unique circumstances.

Already an Aardvark client? Let your client director know that you would like to talk to our financial adviser and we’ll put you in touch.

Not a client yet? What are you waiting for? Check out our packages – they all include free financial advice.