Stop at home Mum - Tax Allowance

beaker141 · 27 February 2005 at 11:13PM

All,

My wife is to be a stop at home mum now that we have 2 children, there is a slim chance she may return to work but only doing one day week from September so should only earn approx 2-2.5k a year.

What can I do to avoid wasting her personal tax allowance. I know this is a highly campained for area which basically discriminates against stay at home mums.

The only "MoneySaving" thing I could think of is to transfer a load of savings and stoozed money into a personal savings account solely in her name and then register for R85 interest without tax.

I don't think this will earn us £4000+ unfortunately - is there anything else anyone can think of or knows about to help ! It pains me to see the allowance wasted when I could be using it.

Ted_Hutchinson · 27 February 2005 at 11:48PM

Might be better moved to the Tax forums.

filigree_2 · 28 February 2005 at 12:46AM

You wouldn't gain a whole £4000 by taking on your wife's allowance anyway. You'd save about 25% of it ie £1000.

You could claim Working Tax Credit or change your current claim, that might bring in a few extra bob.

Glad · 28 February 2005 at 9:26AM

Ted_Hutchinson wrote:

Might be better moved to the Tax forums.

I think you're right ted

beaker141 · 28 February 2005 at 11:08PM

filigree wrote:

You wouldn't gain a whole £4000 by taking on your wife's allowance anyway. You'd save about 25% of it ie £1000.

You could claim Working Tax Credit or change your current claim, that might bring in a few extra bob.

Filigree - A £100 is a lot of money to potentially save !

Already maxed out on whatever benefits we are eligable for based on my salary alone.

How do I move this thread to Tax area - is it a moderator task ?

Spendless · 28 February 2005 at 11:24PM

you've already been moved to the tax site.

Did you remember to tell tax credits about your new baby as you're entitled to an extra £545 for the babys 1st year.

Paul_Varjak · 28 February 2005 at 11:49PM

I think you are correct that you could transfer your savings/investments into your wife's name and register for gross interest with form R85. These savings/investments would then be owned solely by your wife which may have other implications.

In general, I think a self-employed working spouse can make the non-working spouse an employee or partner in the business. An actual salary would have to be paid to benefit from any tax-saving. But this would not seem to be applicable to your case.

beaker141 · 1 March 2005 at 5:54PM

I think the Inland Revenue have got this one well and truly boxed off. I will :-

1. Get the stoozer savings into the wifes name to get interest free of tax via R85.
2. Drop a line to everyone in office I can find expressing my outrage ! #
3. Get the wife back to work earning the 4.5k asap !

Talk is rife about extending paid maternity leave to 9 months but nothing on this !

P.S. Tax Credit People were informed about birth of child within a couple of days, as well as child benefit office. This stuff adds up to quite a tidy sum monthly.

jellyhead · 1 March 2005 at 7:33PM

hi beaker, start a campaign, i'd like my hubby to be able to get my tax allowance when i become a stay at home mum too!

i think (but don't shout at me if i'm wrong!) that there's also a discrepancy in the way tax credits are worked out in one income families - don't they ask for your pre-tax earnings? so a 2 income couple will bring home around a thousand more in take-home cash than a 1 income family yet they are assessed on the same joint income. it wouldn't make a difference if the joint income was over 24k i suppose but for those earning under that threshold it could mean a big difference.

Finishrich · 1 March 2005 at 11:42PM

beaker141 wrote:

Talk is rife about extending paid maternity leave to 9 months but nothing on this !

I heard that on the News too, it's the Labour party bait for re-election, since it's what they propose if they're re-elected :rolleyes:

robindunne1 · 2 March 2005 at 3:19PM

This has annoyed me for years. My wife stays at home to look after the family but I don't see any of her tax allowance. It seems the government are doing everything to help families with two parents that work - extended maternity leave, child care tax credits etc...., but those with one income don't get a look in.

The married man's tax allowance went years ago and I earn out of the bracket for tax credits, this really does annoy me too!!!!

Stop at home Mum - Tax Allowance

Comments

Categories

Get our FREE Weekly email full of deals & guides - and it’s spam-free