Partnership Insurance

Partnership insurance allows the partners of a partnership to provide funds to purchase the share of a deceased partner from their personal representatives. The life assurance contracts are affected by the partners personally. This ensures the surviving partners retain control of their business.

How are the premiums paid?

There are two options:

  • By the partners out of “Net” income
    • Salary increases, to cover cost, is allowable against Corporation Tax liability
  • By the company on behalf of partners
    • Premiums are fully allowable against the company’s Corporation Tax
    • BIK (Benefit In Kind) liability for partners
    • This is most commonly chosen option