- A PREBS is established Offshore by a U.K. Employment Company for the purposes of paying discretionary bonuses, accidental injury and death in service benefits to employees, their spouse or dependants.
- A PREBS is set up under an irrevocable Trust with Offshore Trustees. The Trust Deed will exclude any provision for payment of "relevant benefits" as defined in Section 612(1) ICTA 1988, so that no FURBS subject to Inland Revenue Regulations, is constituted. The Scheme Trustees will have full discretion as to which members; their spouse or dependants will receive benefits.
- The Company setting up the PREBS can inform the Scheme Trustees by way of a Memorandum of Wishes what benefits they would like the Trustees to pay to which members and when.
- It is advised that the proprietors of the company should be excluded from benefits under the PREBS but that their widows and dependants are included in the class of discretionary beneficiaries. It may be possible to include the proprietors provided a reasonable proportion of the overall employees are included.
- It is intended that Members of the PREBS will be able to enjoy benefits both before and after their retirement from the Company but not by reason of or in respect of such retirement.
- It is recommended that periodic bonus payments be made to the Member employees. These payments would be subject to Income Tax in the United Kingdom. These payments can be of any size. (e.g. small Christmas Bonus)
Benefits Of Establishing A PREBS:
When setting up a Pre-Retirement Employee Benefit Scheme we at ECS International work closely with the clients Accountant or Tax Advisor to ensure that they are fully aware of the scheme structure and its advantages.
'The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.'
