Reach out today
Contact us today and book your consultation and see how Quigley Financial Brokers can help you choose the best options available or contact richard@quigley.ie for further information.
What do we do with our Company's money?
Traditionally companies have invested directly in deposit accounts or through
direct/share purchases, while this route can seem familiar to many, it can bring
unwanted tax complications.
Investing with a Life Company can be more efficient
An alternative route is to invest surplus capital in a Life Company Investment Bond or
Savings Plan, for Close Companies* this can be potentially more efficient for a
number of reasons.
Company investments exit tax
Company investments only have to pay an exit tax of 25%** and are not subject to
the potential 33%*** tax paid on any gains made on direct investment in equity or
property, there is no further tax liability.
Close Company surcharge
The Close Company surcharge of 20% for undistributed income does not apply to
funds held within a life insurance investment bond or savings plan.
Reduce tax and payment administration
Reduced tax and payment administration – it is the Life Insurance company that is
responsible for the withholding and payment of any tax and not the Close Company
itself.
Defer payment on tax
There is the potential to defer payment of the tax until the 8th anniversary of the
policy. While reducing the tax burden, this also has the added advantage of
compounding growth overtime compared to where income maybe paid annually on
direct investments.
*A Close Company is one that is controlled by five or fewer participators or is controlled by any number of participators who are directors.
**Source LIA factsheet, September 2024.
*** Source LIA factsheet, September 2024.
Commenti