Company Share Re-Allocation

[Weltchy]

Quick question guys,

Currently got a 60%/40% allocation between myself and my other half. However, her salary is going to start ramping up soon once she's finished her CIMA exams (fingers crossed). As it stands, her 40% share keeps her around or just above the HRT, therefore, with my agreement, she would like to readjust the shareholding to 70%/30% to ensure she is not penalised.

Would the easiest way to readjust the share holding be to just adjust the shares using the company annual return, which is due very shortly.

Not sure if I'm going to need to file any other documents, ie SH01 / form 88(2), in addition to a drawn-up document indicating that the transfer of shares to me is a gift or what-not?

[Maslins]

Not something I've done in a while, but I do know it's not as simple as you suggest. If you do definitely want to change the share ownership I would certainly seek paid professional advice.

Also, bear in mind (stating the obvious) that unless you're taking a pay cut, your combined earnings are going to be higher, so inevitably more income will be into higher rates, unless you reduce your total dividend draw.

To make things simpler and less provocative to HMRC (though a bit less tax efficient), you could pay yourself a larger salary from the company (which would be subject to PAYE/NI etc) to make your earnings (pre dividend) more in line with hers.