I am full time paye on 42k so any more money is at high tax rate, My wife is unemployed so I have as much of her tax credit that i can take.Can i start a sole trader in my unemployed wifes name so that we can benefit from her tax credit , even though the wife is not doing the work but i will be doing it?, does it matter if she dosen't know anything about the job?, would that be against the law?
sole trader in wifes name
- Thread starter sean01
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Unbelieveable in this day and age.
One minute you are paying her, then you're not because she won't know anything about it, but its all ok because it will go back into the family income
My, my, would she get a shock if revenue wrote to her at some stage.
One minute you are paying her, then you're not because she won't know anything about it, but its all ok because it will go back into the family income
My, my, would she get a shock if revenue wrote to her at some stage.
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T McGibney
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It wouldn't work for a second. Revenue would smell a rat at registration stage and if they rumbled your motive you could end up facing an attempted fraud rap.
She sets up as sole trader so she knows about that but she is not familiar with the work itself, that's what I mean by her not knowing about the job. I do the work and she pays me as an employee, so it is her business but she dosen't have to be familiar with the work as she is paying someone to do it, surely that is not tax evasion?. For example say she sets up an architectural practice but knows nothing about architecture and employes an architect to work for her, is that breaking any law?
There are a number of issues here that you should explore fully. For example pension considerations are likely to be more significant than tax.
Under the present arrangement will your wife qualify for a contributory pension when she reaches that age. It doesn't appear that she will. If you took her on as an employee or made her a partner in the business then she would be paying prsi contributions which would go toward a pension entitlement. This might cost something in the short term but might be worth a lot in the longer term.
While T McGibney above is usually well informed on tax matters, I cannot see why you would not take your wife into the business as a partner. It makes no difference, that I can see, that she isn't an "architect". Every business requires some marketing, administration, accounts, etc.
Under the present arrangement will your wife qualify for a contributory pension when she reaches that age. It doesn't appear that she will. If you took her on as an employee or made her a partner in the business then she would be paying prsi contributions which would go toward a pension entitlement. This might cost something in the short term but might be worth a lot in the longer term.
While T McGibney above is usually well informed on tax matters, I cannot see why you would not take your wife into the business as a partner. It makes no difference, that I can see, that she isn't an "architect". Every business requires some marketing, administration, accounts, etc.
T McGibney
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J
Jon Snow
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It's at a minimum tax avoidance, which would fall foul of anti avoidance provisions, if not on first principles as she isn't IN FACT running a business, but is just a straw man / nominee for the person running the business. This isn't a novel idea and it's not clever OP.
You can mitigate a tax bill by paying her an appropriate wage for work that she actually does for you in your business, but again not something nonsensical which suggests she earns more from your boxers than you do...