Section 72

Safeguarding Your Legacy: Unveiling the Power of Section 72 Insurance

In the realm of financial planning, ensuring the smooth transfer of wealth to loved ones is paramount. For couples like John and Mary, aged 54, the prospect of leaving behind a substantial estate raises important questions about taxation and inheritance. Without proper planning, their beneficiaries could face a hefty tax bill, potentially jeopardising the legacy they wish to leave behind. Let’s explore how Section 72 insurance serves as a vital tool in mitigating this risk and securing their family’s future.

Understanding the Challenge: Imagine this scenario: John and Mary, with an estate valued at €2 million, face a daunting inheritance tax liability of €328,350 upon the second death. This significant tax bill could pose a considerable burden on their beneficiaries, requiring them to sell assets to settle the debt within a year of their parents’ passing.

Enter Section 72 Insurance: Section 72 insurance emerges as a strategic solution to this challenge. At its core, it is a guaranteed Whole of Life insurance policy designed to provide a tax-efficient means of passing on wealth to beneficiaries. For John and Mary, this policy ensures a tax-free lump sum payout upon the second death, offering both financial security and peace of mind to their loved ones.

  1. Payout vs. Premiums Paid: If John and Mary live to the average life expectancy of 83, they will have paid approximately €137,784.96 in premiums for a guaranteed payout of €328,350. This means that their beneficiaries stand to gain €190,566 in payout versus premiums paid, a significant return on investment that secures their financial future.

  2. Estate Reduction and Tax Savings: Additionally, the premiums paid for the Section 72 policy reduce the value of John and Mary’s estate by €137,784.96. This reduction in estate value translates to €137,784.96 that their beneficiaries will not have to pay 33% tax on, resulting in substantial tax savings and preserving more of the estate for future generations.

The Emotional and Financial Impact: Beyond the numbers, the true value of Section 72 insurance lies in the peace of mind it provides. For John and Mary, knowing that their beneficiaries will receive a tax-free inheritance alleviates financial stress and ensures that their legacy endures for generations to come. It’s not just about saving money—it’s about safeguarding their family’s future, both financially and emotionally.

In conclusion, Section 72 insurance offers a comprehensive solution to the challenges of estate planning, providing tax efficiency, financial security, and peace of mind. Guided by the expertise of Brian Whelan from, John and Mary pave the way for a prosperous future for themselves and their loved ones, ensuring that their legacy lives on for generations to come.

Get this exploratory process started by requesting a quote for your own policy here or contacting us here.  We can help you to calculate your CAT liability and suggest some ways to reduce this amount and fund for it in advance in a tax efficient manner.

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