My other half is thinking of contracting also, is it better from a tax/costs point of view for her to use my company and we split the shares 50/50?
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Wife might contract, same company?
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It will prolly save you some accounting fees, but be prepared for your existing fee to go up, eg we charge £1,000 base and add on £240 for a second contractor. Other firms may vary.
Won't significantly change IR35 position by itself.
In most cases its tax neutral whether you split the shares in one co according to income, or have two separate companies.
The bottom line on this type of question is normally practicalities, for the most part domestic: are the two of you happy sharing a company and de facto pooling things, or would you prefer to each keep your own finances separate. -
Again, why do we get the same quesiton on the same topic within days of each other? Sockies holiday or something?
To the OP.... scan the last day or two in both sections. This question has been asked already and is rumbling on... The key bit seems to be VAT thresholds it seems.
Also try the search, the shares/pay set up for the wife has been discussed many times.'CUK forum personality of 2011 - Winner - Yes really!!!!Comment
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Originally posted by Jessica@WhiteFieldTax View PostIt will prolly save you some accounting fees, but be prepared for your existing fee to go up, eg we charge £1,000 base and add on £240 for a second contractor. Other firms may vary.
Won't significantly change IR35 position by itself.
In most cases its tax neutral whether you split the shares in one co according to income, or have two separate companies.
The bottom line on this type of question is normally practicalities, for the most part domestic: are the two of you happy sharing a company and de facto pooling things, or would you prefer to each keep your own finances separate.
I'd suggest more often than not it makes sense. If you're married chances are your money is pooled anyway...so you wouldn't get the issues when people talking about setting a company jointly with a mate.
One potential downside is if two fee earners bumps your turnover up enough to force you to leave the FRS...but in most cases I'd expect the benefits of going through one co to outweigh the disadvantages.Comment
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Originally posted by Jessica@WhiteFieldTax View Post
Won't significantly change IR35 position by itself.Comment
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Originally posted by matzie View PostTrue, but if you *really* wanted to 'pass' the business entity test, then *perhaps*, if your wife was neither a shareholder or a director of the company, but brought in 25% of the company's annual turnover, that would give you the 35 points available for the 'assistance' test - in theory. That's unlikely to hold water IMHO... but it would meet the letter of the test rules.'CUK forum personality of 2011 - Winner - Yes really!!!!Comment
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Originally posted by matzie View PostTrue, but if you *really* wanted to 'pass' the business entity test, then *perhaps*, if your wife was neither a shareholder or a director of the company, but brought in 25% of the company's annual turnover, that would give you the 35 points available for the 'assistance' test - in theory. That's unlikely to hold water IMHO... but it would meet the letter of the test rules.Comment
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