# Employee employing Wife



## jumper1 (20 Aug 2009)

Hi I am an employee working for a Designer Company. 

Currently i have Land that i have leased and there is a lot of paperwork involved in keeping things going.

As i am very busy at work i am finding it increasingly difficult to keep up to date with stuff on the leasing stuff. I was thinking of getting my wife to take on this, she has been unemployed for the past 18months, but she said that she would have to be paid to do this. Is it possible to take on my wife as an employee and pay her a wage and claim it against the income that i make from the leasing?

I did a bit of reading and the Revenue says that you can only employ some one of you need a work force. This is very Cryptic as i could do the work myself but i would be at it all weekend at least 2 weekends a month. 

I was also thinking of applying for the Revenue Job Assist for my Wife, as she has been unemployed for over 18 months. But reading the revenue site regarding this it says that the 'Created Job' could not be taken up by the Proprietary Directory of a company or the spouse of such a Company'.

Would you be able to tell me if this would apply to me as i would not be creating a company just employing my wife to do some paperwork for me.


Regards, Jumper1


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## Complainer (28 Aug 2009)

What is the benefit of paying her? You take money out of one part of the household and switch it to another part?


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## you're gas (11 Sep 2009)

Set yourselves up as a partnership.  Have yourselves assessed jointly for Tax.  Doesn't make a difference who actually performs the work in the partnership.  You both will benefit from your wives tax credits and allowances.  If you employ your wife you will be liable for employers liability insurance, have to provide a means to a pension for her, have to pay employers prsi on her earnings and so on.


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## Tentman (12 Sep 2009)

This could only happen in Ireland. There are thousands of small businesses in Ireland which are not incorporated. In those cases the husband cannot employ his wife in the business, whereas he can employ a son or daughter. Can anyone explain how this is so?


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## Graham_07 (12 Sep 2009)

you're gas said:


> have to pay employers prsi on her earnings and so on.


 
This is incorrect. A spouse employed by a spouse is not insurable for SW purposes. While PAYE may be operated on the employment under normal PAYE rules, PRSI is not payable, only levies where applicable ( if earnings exceed the threshold) Class M is what usually applies or K1 if over the levies threshold. 




Tentman said:


> In those cases the husband cannot employ his wife in the business, whereas he can employ a son or daughter. Can anyone explain how this is so?


 
There is nothing stopping a self-employed person employing their spouse, getting a tax credit certificate for them and applying PAYE rules to the employment. As above, it is not insurable for PRSI purposes but there is no reason otherwise. If the spouse is being employed then the parties can avail of the higher 20% cut-off point. ( and just to prove the point, I have done exactly that for several years with my wife who is employed by me in my practice. )


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## Tentman (24 Sep 2009)

There is nothing stopping a self-employed person employing their spouse, getting a tax credit certificate for them and applying PAYE rules to the employment. As above, it is not insurable for PRSI purposes but there is no reason otherwise. If the spouse is being employed then the parties can avail of the higher 20% cut-off point. ( and just to prove the point, I have done exactly that for several years with my wife who is employed by me in my practice. )[/quote]

I own a small business and have been told by my accountant that I cannot employ my spouse. I'm a sole trader. Have employed son & daughter, in the summers when they were at school. Are you absolutely sure???


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## Dave Vanian (25 Sep 2009)

Tentman said:


> I own a small business and have been told by my accountant that I cannot employ my spouse. I'm a sole trader. Have employed son & daughter, in the summers when they were at school. Are you absolutely sure???


 
I'm a sole trader and I employ my spouse.  She pays Class M PRSI which I understand qualifies her for very little, but otherwise she's an employee like any other.


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## Tentman (25 Sep 2009)

Dave Vanian said:


> I'm a sole trader and I employ my spouse. She pays Class M PRSI which I understand qualifies her for very little, but otherwise she's an employee like any other.


 

Thanks very much for the info. I'm off to have a nose to nose chat with the accountant first thing Monday !!!!


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## Graham_07 (29 Sep 2009)

Dave Vanian;935740.  said:
			
		

> She pays Class M PRSI which I understand qualifies her for very little,.


 
Nothing at all in fact.


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## NHG (29 Sep 2009)

My mum works in a family business (employed by husband and bil) she pays S class PRSI, authorised by Social welfare Dept.


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## user name (2 Jun 2010)

paying maintenance to wife (ex). as payments are voluntary there is no taxation relief for making the payment. falling into high tax bracket and she is not using up all her tax credits and bands. as am sole trader would there be anything wrong with putting maintenance payments to her through as wages every week. advice appreciated, thanks


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## Graham_07 (3 Jun 2010)

user name said:


> paying maintenance to wife (ex). as payments are voluntary there is no taxation relief for making the payment. falling into high tax bracket and she is not using up all her tax credits and bands. as am sole trader would there be anything wrong with putting maintenance payments to her through as wages every week. advice appreciated, thanks



Nothing at all wrong as long as she does in fact work for the wages received.


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## user name (3 Jun 2010)

no she does not work, put she feels she is entitled to half the profits from the business which is registered as sole trader not partnership. just trying to save some tax. Also i do not have any tax credits/cut off for her but have not deducted any paye as i know she has not used her single person, parent or paye credit, technically wrong i know but will save thousands in tax.


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## headache (17 Jun 2010)

A spouse or child (with exceptions) of a proprietary director is not entitled to a PAYE credit.  I've had much discussion about PRSI class in this case as I have director's wives paying at class A but we've removed their entitlement to the PAYE credit.  Revenue guidelines are not very specific.
But I can't find anything regarding a spouse employed by a sole trader - anyone know if they can claim the PAYE credit?


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## Graham_07 (17 Jun 2010)

headache said:


> But I can't find anything regarding a spouse employed by a sole trader - anyone know if they can claim the PAYE credit?




Another thread on this whole topic here 

Spouses of sole traders do not get the PAYE credit either.


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## Pat Bateman (17 Jun 2010)

user name said:


> no she does not work, put she feels she is entitled to half the profits from the business which is registered as sole trader not partnership. just trying to save some tax. Also i do not have any tax credits/cut off for her but have not deducted any paye as i know she has not used her single person, parent or paye credit, technically wrong i know but will save thousands in tax.


 
Look at it from the other side.

Should you be entitled to a trading deduction in relation to her salary?

It's a rhetorical question...of course you shouldn't. You're on dangerous ground.


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## headache (18 Jun 2010)

Graham_07 said:


> Another thread on this whole topic here
> 
> Spouses of sole traders do not get the PAYE credit either.


 
Thank you Graham.


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