Income Splitting with Spouse....

**Craig@Clarity** · 10 January 2011, 16:47

Have a look at http://forums.contractoruk.com/accou...ng-yes-no.html

**prozak** · 10 January 2011, 17:02

Originally posted by Craig@InTouch View Post

Have a look at http://forums.contractoruk.com/accou...ng-yes-no.html

thanks.

**prozak** · 10 January 2011, 17:20

Originally posted by Craig@InTouch View Post

Have a look at http://forums.contractoruk.com/accou...ng-yes-no.html

Follow up if you don't mind...

So to sort this out....

1. ALLOT 9 Ordinary Shares (I currently only have 1). With a value of X which I pay to company.
2. Gift 1 share to my wife.
3. Make sure shareholders are registered.

?

**v8gaz** · 10 January 2011, 18:20

Go for it. At present, there is nothing stopping you from minimising your family tax liability by careful allocation of shares in your business. Yes, they will try to beat this again, and yes, PCG will continue to actively campaign against this.

**Retro** · 10 January 2011, 18:56

Tread Carefully

Originally posted by prozak View Post

I am sure this broad topic is covered somewhere and I know HMRC went for Arctic and will try again to get something done here.

However, I am wondering whether it is OK to do it in a smaller way.

In the next tax year I am going to employ my wife part time on a salary up to the personal allowance to do admin etc.

I was wondering whether hector would have issues with this and then also I was planning on selling her shares that would make her a 10% shareholder and paying her dividends when and if the company makes a profit / pays a divi.

Thoughts?

After receiving advice from my accountant at the time, I decided to pay my wife a salary and I listed a dozen or so tasks that she performed. When I received a visit from HMRC they rejected the list with the comment "in our opinion your wife does nothing significant for the company" and I had to pay the PAYE/NI as if the salary paid to my wife was my own. So in theory you should have no problems but in practice you might.

**malvolio** · 10 January 2011, 21:24

Originally posted by Retro View Post

After receiving advice from my accountant at the time, I decided to pay my wife a salary and I listed a dozen or so tasks that she performed. When I received a visit from HMRC they rejected the list with the comment "in our opinion your wife does nothing significant for the company" and I had to pay the PAYE/NI as if the salary paid to my wife was my own. So in theory you should have no problems but in practice you might.

Which is a damned good reason for having PCG Plus membership

Seriously, that is total borax. Please tell me you didn't have legal representation

**prozak** · 10 January 2011, 21:41

Originally posted by Retro View Post

After receiving advice from my accountant at the time, I decided to pay my wife a salary and I listed a dozen or so tasks that she performed. When I received a visit from HMRC they rejected the list with the comment "in our opinion your wife does nothing significant for the company" and I had to pay the PAYE/NI as if the salary paid to my wife was my own. So in theory you should have no problems but in practice you might.

Well, my wife already proof reads my work as well... and is very good at it as her degree is in English....

I am at the level with my work that my main output is documents and powerpoints so having a proof reader is valuable..... also a lot of my work needs to be comprehensible by non technical people, so running it by her helps with that as well....

Surely HMRC cannot knock that back?
Without a decent proof reader I wouldn't get renewed so readily....

**northernladuk** · 10 January 2011, 21:45

Originally posted by prozak View Post

Well, my wife already proof reads my work as well... and is very good at it as her degree is in English....

I am at the level with my work that my main output is documents and powerpoints so having a proof reader is valuable..... also a lot of my work needs to be comprehensible by non technical people, so running it by her helps with that as well....

Surely HMRC cannot knock that back?
Without a decent proof reader I wouldn't get renewed so readily....

I don't work for HMRC and I am laughing hard after reading that so imagine what they would make of that.... proof reading.... heard it all now.

**prozak** · 10 January 2011, 22:46

Originally posted by northernladuk View Post

I don't work for HMRC and I am laughing hard after reading that so imagine what they would make of that.... proof reading.... heard it all now.

Glad I gave you a laugh... but in my work there is no acceptable margin of error.

(Snipped a little of my comment here it cam out harsher than I intended....)

and that is but one of her tasks but in my opinion a valuable one directly linked to revenue.

Income Splitting with Spouse....