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Business Financial Planning

Whether you are a sole trader, partnership or a limited company, working with a specialist who can offer solid financial advice can lay the foundations of an effective and profitable business by organising and protecting you against risks and safeguarding the health and well-being of your employees.

By understanding your business goals and long term objectives, we can provide impartial advice on key financial aspects such as business protection, employee benefits, workplace pensions and tax liabilities, and can work closely with other professional advisers such as your accountant or solicitor.

We can also help with arranging formal financial plans for the management of your income when you retire, ensuring that you and your family benefit from all your hard work.

Our areas of business finance expertise include:

sml04A death or serious illness can have serious consequences for a small to medium-size business, such as:

  • the loss of profits
  • the calling in of company overdrafts and the disruption of lines of credit
  • unwanted changes in the balance of shareholder control
  • the dissolution of a partnership
  • difficulties and conflicts in recognising fair value for inherited shareholdings and partnership shares

The solution lies in legal agreements governing the disposal of company shareholding and partnership shares, financed through appropriate life and critical illness insurance policies. Our business protection specialists will give crucial advice on tax implications including how Income Tax, Capital Gains Tax, or Inheritance Tax might impact on any arrangement being considered. The key contracts of insurance are life and critical illness policies.

  • Life assurance policies pay benefits on death.
  • Critical illness policies pay out on the diagnosis of any of a series of any specified serious medical conditions, such as heart attacks, strokes, most forms of cancer, multiple sclerosis and permanent total disability.

The basic strategy involves drawing up a business continuation agreement between shareholders, supported by a series of life assurance policies and trusts. The continuation agreement sets out the terms of the disposal of the shares, the life assurance policies provide the finance and the trusts ensure that the proceeds of the life policies are paid immediately and are free of inheritance tax.

If a key person of a business dies or becomes seriously ill, it can be a major blow to even the most successful and well established company. In many cases there are often one or two key employees around whom the whole business revolves.

Key person cover will provides a lump sum to the company in the event of the death or serious illness of that individual, which the company can use to recruit a replacement and/or sustain the business during any downturn in trade following the event.

sml05A first-class employee benefits package is an important consideration for companies wishing to attract high-calibre, skilled employees. It is also a well-known fact that such benefits packages assist employee retention, which is far more cost-effective for a business than recruitment.

Innes Reid has a wealth of experience in setting up such packages and can provide expert advice on the design and implementation of a bespoke package to suit your needs.

sml06Contributing to an approved pension plan is the most tax effective way of providing income in retirement. It is also arguably the most important employee benefit that can be offered by an employer.

Innes Reid has extensive experience in advising, planning and implementing pension arrangements to match individual and company circumstances, including:

  • Auto Enrolment Schemes
  • Group Personal Pension Plans
  • Group Stakeholder Plans
  • Executive Pension Plans
  • Small Self-Administered Schemes (SSAS)
  • Unapproved top up pension schemes
  • Self-Invested Personal Pensions (SIPPS)
  • Income Drawdown and phased retirement

We will also review existing arrangements and recommend changes where necessary.

Group Life Assurance is relatively inexpensive to provide. Normally, all employees of the company are covered irrespective of their state of health. Death benefits can be paid as a tax free cash sum up to the Lifetime Allowance. Any dependant’s pension provided does not count towards the deceased member’s Lifetime Allowance.

Group Critical Illness is a valuable, tax-free addition to any benefits package that provides lump sum benefit to employees diagnosed with a specified critical illness. It can provide cover anywhere in the world, in addition to temporary absence cover for those employees who are taking a break from work.

sml07Loss of income through illness or disability can be devastating, yet many people running a business do not give serious consideration to this. Income Protection (IP) cover will replace part of a person’s income if sickness or disability prevents a person from earning, and payments are tax free.

IP cover enables you to protect pension and National Insurance Contributions, and helps your business to meet its obligations under the Disability Discrimination Act. In addition, it is an allowable cost against Corporation Tax.

With rehabilitation increasingly becoming a provision of many policies, bridging the gap and getting your employee back to work is a realistic option, enabling you to save on the costs of recruiting new staff.

As Chartered Financial Planners, Innes Reid offer the very best financial planning service for businesses. We aim to become part of your team, helping you to maximise your success in growing and protecting your organisation whilst keeping costs and investments in check.

The Financial Ombudsman Service (FOS) is an agency for arbitrating of unresolved complaints
between regulated firms and their clients. Further details of the FOS can be found on its website:
www.financial-ombudsman.org.uk