Ltd company setup

[bodford industries]

Hi, I'm new to the game. I am considering setting up a ltd company to handle some freelance work I've been commissioned to undertake. My wife will undertake a degree of work for the company. currently she does not work. If I setup a ltd company I would like to pay her (and take advantage of her unused personal tax threshold and lower rate tax rate). Should I make her a director of the company when I setup or keep her as a basic employee.......if the latter would the company be liable for other obligations such as pension contributions etc. We would rather keep things simple and simply pay her for her work and avoid a lot of unnecessary red tape.

[cosmic]

Hi, I'm new to the game. I am considering setting up a ltd company to handle some freelance work I've been commissioned to undertake. My wife will undertake a degree of work for the company. currently she does not work. If I setup a ltd company I would like to pay her (and take advantage of her unused personal tax threshold and lower rate tax rate). Should I make her a director of the company when I setup or keep her as a basic employee.......if the latter would the company be liable for other obligations such as pension contributions etc. We would rather keep things simple and simply pay her for her work and avoid a lot of unnecessary red tape.

Get an accountant!!!!!! She would be a director who holds shares within the company therefore does not need to be on the books as a shareholder. Also directors can be exempt from pension contributions. Get a good accountant that would do all this for you and guide you through this.

[Lance]

1. only setup a LTD if it makes sense to do so. "Just for tax" isn't necessarily a good reason. It depends. An accountant will help you decide (and probably for free).
2. You don't need to make her a director although it does have some benefits. Not least of which if you die she is empowered to handle the particulars. An accountant will help you decide.
3. No pension obligations if you/she choose not to. An accountant could tell you this.



....
oh. Talk to an accountant..... In case that's not clear.

[northernladuk]

Will she really do some work for the company or are you trying to give us the old book keeping line? At least be honest with yourself when setting up.

[Lumiere]

3. No pension obligations if you/she choose not to. An accountant could tell you this.

But still have to pay accountant to set the scheme up and then go through the hassle of leaving it every 3 years?

[ladymuck]

But still have to pay accountant to set the scheme up and then go through the hassle of leaving it every 3 years?

No. An accountant is very rarely licensed to offer pensions.

You do not have to set up a pension every three years and then quit it. There are lots of resources on the pensions website about small company obligations, which are very minimal. You get promoted every few years to reconfirm your status.