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Equalisation of Premium Calculator

When setting up protection for shareholding directors or partners you should consider arranging to even out any differences between the payment that each is making to their plans, differences arising from different ages and health for example versus the value of their shareholding. So some partners will pay more for their cover, but will potentially receive less benefit from the arrangement. This is known as equalisation of premium or payment.

Without equalisation the Inland Revenue may deem the policies to be 'gifts' (transfers of value) and this could lead to inheritance tax liability, as the 'gifts' favour the younger business owners or those with a smaller stake in the business.

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Every care has been taken to ensure that this information is correct and in accordance with our understanding of the law and HM Revenue and Customs practice. However, independent confirmation should be obtained before acting or refraining from acting in reliance upon this information.