It's not clear whether your husband has a limited company set up but either way neither of you are entitled to PAYE credit (not available to proprietary directors or their spouses).
However, assuming that her husband isn't using up all the allowable tax credits, it's better to set up a limited company and pay both spouses a directors salary - as far as I understand, you can pay a director as much as you want. That's what several accountants recommended to me. That way you maximise the amount of salary for the least amount of tax. You can also exploit other benefits (small awards scheme, bike to work scheme, renting part of your own home for home-office, etc. etc.).
So the simplest thing to do is to register you as an employee of your husband (you won't be entitled to a PAYE tax credit), and pay yourself IN A VISIBLE WAY (e.g. by cheque) and record it properly through the PAYE system - this is what the tax inspector would be looking to see, correct operation of PAYE.
But is there any point in doing this? The tax saving will be minimal unless perhaps the husband is paying top-rate tax. (The OP has given no indication that this is the case.) On the other hand, errors in the operation of PAYE, filing incomplete or late returns etc, may actually cost them money.
But is there any point in doing this? The tax saving will be minimal unless perhaps the husband is paying top-rate tax. (The OP has given no indication that this is the case.) On the other hand, errors in the operation of PAYE, filing incomplete or late returns etc, may actually cost them money.
He has one employee already so the risk of late returns is already there.
I hate to say this but, sorry, this is terrible advice, in pretty much every respect.
I can't figure out if the OP's husband has a company or is a sole-trader.
Generally speaking, you cannot pay a PAYE salary to someone for doing nothing. Neither can you pay a large salary to someone who does very little*, especially if that someone is your spouse. My accountant was very clear on that (ok, I suppose you COULD, but Revenue would come down on you like a ton of bricks in the event of an audit).
As the OP is doing the accounts, then she is entitled I suppose an average salary for the hours worked for a bookkeeper.
However, assuming that her husband isn't using up all the allowable tax credits, it's better to set up a limited company and pay both spouses a directors salary - as far as I understand, you can pay a director as much as you want. That's what several accountants recommended to me. That way you maximise the amount of salary for the least amount of tax. You can also exploit other benefits (small awards scheme, bike to work scheme, renting part of your own home for home-office, etc. etc.).
I hate to say this but, sorry, this is terrible advice, in pretty much every respect.
How so?
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