Employer Funded Unapproved Retirement Benefit Scheme

Our EFURBS provides a valuable remuneration planning tool for employers and high earning senior executives and provides a flexible alternative to UK registered pension schemes where the annual or lifetime allowances have already been used.

The attractions of an EFURBS are broadly as follows:

  • An EFURBS is not subject to the post ‘A Day’ rules on the UK pension Annual Allowance or the Lifetime Allowance and should therefore appeal to anyone who has already used up these allowances but wishes to avoid large penal tax charges.
  • The changes introduced by the Finance Act 2009 and the proposal to restrict tax relief on pension contributions means high earners and executives may be interested in diverting bonuses via salary sacrifice arrangements to an EFURBS, which allows the gross roll up of funds in a tax neutral environment.
  • Contributions paid by an employer to the EFURBS should not be taxed on the employee in the year of the contribution and in addition UK National Insurance Contributions should not be due.
  • Benefits should be subject to UK Income Tax on the member or a member of their family, only in the year of receipt of the benefit, providing an effective deferral of UK income tax. It may also be possible to mitigate UK National Insurance contributions in certain circumstances. Benefits may be drawn down in a variety of ways including lump sum payments.
  • Employer tax deductions are deferred until the year in which benefits are drawn by the member.
  • Arrangements could be put in place to allow Partners of Partnerships to set up an EFURBS.
  • A wide scope of investments are permitted and can therefore be tailored to suit the investment outlook of individual members and we can assist with the structuring of discretionary investment portfolios.

We have significant experience in operating bespoke alternative employee/employer arrangements to very HNW individuals. Please let us know if you would like to discuss these in more detail.

It is essential that specific advice be sought by anyone considering the use of an EFURBS and we can recommend legal and tax advisors to assist as necessary.

Contact Clive Damsell