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Employment Contract for spouse?

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    #1

    Employment Contract for spouse?

    I am setting up a ltd company as my brolly sucks. Do i need to have an employment contract for my wife if she is going to do my administration, and get paid for it? She is not working at the moment and I am looking at her doing part time work for me and attracting a salary under the tax allowance.

    I am caught by IR35 if that has any bearings on this.

    Also I am trying to get a new gig at a company i worked at 8 years ago as a permie and think that i will have to supply my own hardware, I am right in thinkign that I will be able to claim this back once my Ltd is up an running? My ltd will be used as the vehicle for my current contract also.

    Pleomax
    Pleomax

    This is an unusual paragraph. I'm curious as to just how quickly you can find out what is so unusual about it. It looks so ordinary and plain that you would think nothing was wrong with it. In fact, nothing is wrong with it! It is highly unusual though. Study it and think about it, but you still may not find anything odd. But if you work at it a bit, you might find out. Try to do so without any coaching!
    Tags: None
    #2
    Originally posted by pleomax View Post
    I am setting up a ltd company as my brolly sucks. Do i need to have an employment contract for my wife if she is going to do my administration, and get paid for it? She is not working at the moment and I am looking at her doing part time work for me and attracting a salary under the tax allowance.

    I am caught by IR35 if that has any bearings on this.

    Also I am trying to get a new gig at a company i worked at 8 years ago as a permie and think that i will have to supply my own hardware, I am right in thinkign that I will be able to claim this back once my Ltd is up an running? My ltd will be used as the vehicle for my current contract also.

    Pleomax
    Yes a contract of employment would show your company is serious about doing things the right way.

    Yes you can claim back equipment costs using Capital Allowances (or AIA this year).

    QB.

    Comment

      #3
      Is there a resource online where one could download template contracts for such a purpose? (I know google is your friend and all taht but someone may save me some time)

      Many Thanks

      Pleomax
      Pleomax

      This is an unusual paragraph. I'm curious as to just how quickly you can find out what is so unusual about it. It looks so ordinary and plain that you would think nothing was wrong with it. In fact, nothing is wrong with it! It is highly unusual though. Study it and think about it, but you still may not find anything odd. But if you work at it a bit, you might find out. Try to do so without any coaching!

      Comment

        #4
        Originally posted by pleomax View Post
        I am setting up a ltd company as my brolly sucks. Do i need to have an employment contract for my wife if she is going to do my administration, and get paid for it? She is not working at the moment and I am looking at her doing part time work for me and attracting a salary under the tax allowance.

        I am caught by IR35 if that has any bearings on this.

        Also I am trying to get a new gig at a company i worked at 8 years ago as a permie and think that i will have to supply my own hardware, I am right in thinkign that I will be able to claim this back once my Ltd is up an running? My ltd will be used as the vehicle for my current contract also.

        Pleomax

        "I am caught by IR35 if that has any bearings on this."


        Lots, you can only have running costs of 5% of the turnover, if turnover is £60K, you have £3k running costs (+bank interest received). Running costs would be bank charges, accountancy fees, computer consumables, mobile phone and your spouses wages ... don't see your spouse being paid a lot do you?

        If you spend more than the 5% then any loss would have to be covered by your net salary!

        Comment

          #5
          Why would spouses wages fall into running cost but not mine?

          Thank you all for being so patient with me asking stupid questions.

          Pleomax
          Pleomax

          This is an unusual paragraph. I'm curious as to just how quickly you can find out what is so unusual about it. It looks so ordinary and plain that you would think nothing was wrong with it. In fact, nothing is wrong with it! It is highly unusual though. Study it and think about it, but you still may not find anything odd. But if you work at it a bit, you might find out. Try to do so without any coaching!

          Comment

            #6
            Originally posted by pleomax View Post
            Why would spouses wages fall into running cost but not mine?

            Thank you all for being so patient with me asking stupid questions.

            Pleomax
            Your salary comes from the other 95%, which you have to take as salary because you're caught by IR35.

            Comment

              #7
              Originally posted by pleomax View Post
              Why would spouses wages fall into running cost but not mine?

              Thank you all for being so patient with me asking stupid questions.

              Pleomax
              Because your wages come out of the 95%.

              Take the total value of the contract .e.g. £101,000. Deduct travel and subsistence expenses of £1000 = £100,000. You have to pay yourself the salary that costs your company (including the employers NI), £95,000. The remaining £5000 covers all costs, as listed above.
              Down with racism. Long live miscegenation!

              Comment

                #8
                Even if I am caught under IR35 do I have to pay myself the 95% of the contract value?
                Pleomax

                This is an unusual paragraph. I'm curious as to just how quickly you can find out what is so unusual about it. It looks so ordinary and plain that you would think nothing was wrong with it. In fact, nothing is wrong with it! It is highly unusual though. Study it and think about it, but you still may not find anything odd. But if you work at it a bit, you might find out. Try to do so without any coaching!

                Comment

                  #9
                  Originally posted by pleomax View Post
                  Even if I am caught under IR35 do I have to pay myself the 95% of the contract value?
                  Yes ...

                  £95K, could be made up of travel and subsitence, pension, PII, the balance would be gross salary and employers NI, or maybe you have no expenses and it is the full £95K as gross salary and Employers NI.

                  You need to speak to an accountant ASAP, or stay with your sh*t umbrella company.

                  Robot

                  Comment

                    #10
                    Originally posted by pleomax View Post
                    Even if I am caught under IR35 do I have to pay myself the 95% of the contract value?
                    [pedant]Anybody who says yes is simply wrong. you don't. But you still get taxed on the basis that you had.[/pedant]

                    Comment

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