Summary

You can now buy life insurance cover and get tax relief on your premiums. But you have to buy a special policy. This article provides the details.

Life Insurance available with tax relief. Page 2

Author: Michael Challiner

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Life Insurance News

company so you pay a premium which is already reduced by standard rate tax relief. If you're a higher rate taxpayer, ( cheap loans ) you'll have to claim the extra tax through your self-assessment tax return. However, once you've told your taxman about your premiums, they should automatically continue to give you the tax relief through your tax code.

So why are the savings less than the value of the tax relief? Well, the reason is that the life companies have to administer the tax relief and there are certain operational restrictions imposed by the Inland Revenue on the insurance company. This means that the basic cost of these policies is a little more than conventional life insurance - but after the tax relief you should save.

As with all these loopholes, you must be aware that the Chancellor could remove the ( travel insurance ) tax relief. Having said that, it is rare for a future tax change to be applied retrospectively so you are likely to be safe. Your income could also change and move you into a lower tax bracket. This would reduce your savings.

This new type of life policy is now available from most of the big UK insurers and specialist ( pet insurance ) life insurance brokers. However, you won't be able to get an online quotation - you'll have to speak on the phone to a Life Insurance Adviser.

And just to confuse matters these policies are known under a range of ( cheap car insurance ) names: Pension Term Insurance, Life Insurance with Tax Relief, Life Protection with Tax Relief - but they all mean the same thing.

Oh yes, let me confirm one miss-understanding. No, you don't have to buy a pension at the same time!