I just needed to get more organised. I was incredibly busy working in my business and I needed someone to take a view, and provide strategic advice. I wanted an independent review of the business to ensure we had the right structures in place to look after our employees, maximise tax efficiency and protect against the unexpected.
Specifically I wanted a pension solution for the Directors and employees; and insurance against a key employee or Director dying. I also felt each Director needed advice for structuring their own personal affairs in order to achieve their goals.
Firstly, Lexington created a Lifestyle Financial Plan and cashflow forecast for each of our three company Directors and their wives.
Lexington then worked with our Accountant to create a business cashflow and examine key business ratios. This process enabled us to devise clear financial goals for the short, medium and long term.
We decided to set up a Small Self Administered Scheme (SSAS) to tax efficiently plan for retirement and meet our Directors’ personal goals. The SSAS purchased the property we were currently operating from, using a small amount of the pension savings of each Director, a company contribution and a small borrowing from the bank.
This structure allowed us to ‘see’ our pension fund. We also used the SSAS to buy equipment for the production line. By using this scheme we receive tax relief on the pension contributions the company makes, which means we are operating in the most tax efficient way.
Lexington arranged life assurance and shareholder protection policies for each of the Directors, paid for by the company.
The Life Assurance was written in Trust to maximise tax efficiency and guarantee a speedy pay out to the Director’s family should the worst eventuate. We ensured appropriate Trusts and agreements were set-up for the individual shareholder protection policies.
The other Directors and I now have clarity for the future. Lexington meets with us every six months to keep everything on track. We now have a fully funded pension, continuity of income in retirement and a tax efficient way of owning our own premises. We can rest assured that the business and our families will survive in the event of a catastrophe.
This plan will allow us all to retire, financially independent of the sale of the company, at an age that allows us to continue our love for golf!