A couple of Tax questions?

It sounds more like Capital Gains Tax (CGT) and not income tax (IT) to me?. I'm assuming the selling of these items is not part of any business / job (your just selling some items you own privately).


You only pay CGT on gains above £11,300


so for example, you sell something that originally cost you £11,000 for £15,000 there is NO tax to pay as the gain is £4,000 and this is below your allowance of £11,300


You could sell some of the things and if you think you will go over the £11,300 then your wife could sell some of the other things as she too has a CGT allowance of £11,300 aswell (though do bear in mind it would be a criminal offence for her to sell something that is not legally hers).


But I know your cleaver so you would have already gifted items to your wife in previous tax years and now legally the items are hers to sell.


As KIDMUGSY has said, you need to give a lot more information.

Talk to your accountant.

taxnewbee wrote: »

Thanks for the responses, sorry for the late rely. I'm pretty sure it's not capital gains tax, although my fault for being so vague.
I'm creating some screen prints that I'm selling through a gallery in the US, maybe 100 or so prints from my original design.
I guess this counts as an income, so I'm wondering if it's possible to set up a company name in my wife's name, I invoice her for the use of the image meaning I only pay tax on that. (Minimal charge say £250) then the potential £10k or so earnings from the sale of the prints can be paid to her (her company) and that's below what she would need to pay tax on for the year meaning I don't loose 40% of my profit from the sale of the prints.

It may be worth tax planning if this is a regular thing but if one off you'd probably just be best to pay the tax.


The route you describe is artificial so may be challenged by HMRC, but even if not you're forgetting the corporate tax if in a company of 20% and the cost of extracting it if she's already used her dividend allowance for example. Then there is the set up costs and time in filing various returns etc. So you may now be saving c.£1k at best with a lot of hassle and potential risk.

martinsurrey wrote: »

OP can quite legally grant his wife a licence to use his art work for free (nil cost nil gain on spouse transfers), as such he will be merely printing his wife's IP and copyright art for her.

Main gain would be the wife's.

OP It might be worth speaking to an accountant to get the paperwork drawn up correctly, and make sure your wife is the named party on the invoice to the US gallery, and the cash goes to her account.

That screams income settlement to me - you're essentially gifting a right to income to a spouse, which makes the gift transparent for income tax purposes so will be taxed on the OP anyway.

Also you need to understand your US tax implications - it's unlikely it'll be taxable there as your actions won't be enough to create a US permanent establishment, but someone should give you a proper opinion on that.