Retirment - Exit strategy

[duncan_m]

Reply: 2.1.1.1.3.1.1.1.1.1.1
From: Duncan M


Dale,

If the beneficiary of the Insurance Policy is the Business why would it be
subject to FBT? ie, the business is concerned that if you do they will need
to expend a lot of resources in finding a replacement, training etc.. hence
they take our a Life Policy on your life.. Wouldn't this expense be
deductible?

Regards,

Duncan

 

[DaleGG]

Reply: 2.1.1.1.3.1.1.1.1.1.1.1
From: Dale Gatherum-Goss


Hi Duncan!

Life insurance that will benefit the individual's spouse or family is not a tax deduction to the company and if we argued that it was, we would be providing a benefit to the family in lieu of salary and therefore subject to FBT.

Where the business is the policy holder and beneficiary the tax office have suggested that it might be tax deductible although as I've mentioned earlier, this would mean that the business get's the payout and not the family.

Key man insurance is a different situation and may be tax deductible if it was taken out to protect against a loss of income.

Does this help?

Dale

 

[duncan_m]

Reply: 2.1.1.1.3.1.1.1.1.1.1.1.1
From: Duncan M




Yes, that makes it clearer Thanks.

> -----Original Message-----
> From: propertyforum Listmanager
> [mailto:[email protected]]
> Sent: None
> Subject: RE: Retirment - Exit strategy
>
>
> From: "Dale Gatherum-Goss" <[email protected]>
>
> Hi Duncan!
>
> Life insurance that will benefit the individual's spouse or
> family is not a tax deduction to the company and if we argued
> that it was, we would be providing a benefit to the family in
> lieu of salary and therefore subject to FBT.
>
> Where the business is the policy holder and beneficiary the
> tax office have suggested that it might be tax deductible
> although as I've mentioned earlier, this would mean that the
> business get's the payout and not the family.
>
> Key man insurance is a different situation and may be tax
> deductible if it was taken out to protect against a loss of income.
>
> Does this help?
>
> Dale
>
>
>
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