Paying a spouse - how?

Lizzieb151

My husband is self employed (sole trader) and in his 3rd year. This year work has really started to pick up so I have started to help him out - now I was told that a spouse could be paid up to £149 per week without any tax or NI implications as long as the money was actually paid into my account.

What I would like to know is what is needed for the books - do I have to become self employed aswell so my husband can pay me or can I just do a book entry of the amount of hours I worked that week and make payment? Are there additional forms that need to be filled out?

I probably only work approx 10 hours a week so we are not talking much.

Any advice much appreicated

purdyoaten

If your husband pays you between £109 and £148 ( £111 and £152 for 2014/15) tehre is no liability to tax or NIC. However, he will have to register as an employer even though there are no deductions as, between those amounts, you will gain credit towards your state pension. The wage would have to be reasonable for the work done and,as you say, actually paid.

Any amount paid below £108 (£111) do not require any registration as an employer but, again, the evidence of payment must be clear.

In such circumstances you are an employee of your husband - definitely not self-employed.

Lizzieb151

That's great thanks - it is only approx 10 hours a week at so below £108.
Does it have to be paid weekly? Sometimes he paid me straight away and sometimes he did 2 weeks at once - does it matter as long as I have a record of what hours were worked and when?

purdyoaten

Adopt a common sense approach to this.

Sometimes he paid me straight away and sometimes he did 2 weeks at once

Does any other employer do that? Monthly would be fine but HMRC would expect you to be regarded as any other employee would. Not many employees would be content with being paid in the manner that you suggest.

zygurat789

Lizzieb151 wrote: »

That's great thanks - it is only approx 10 hours a week at so below £108.
Does it have to be paid weekly? Sometimes he paid me straight away and sometimes he did 2 weeks at once - does it matter as long as I have a record of what hours were worked and when?

What matters is to have a record of the payment, a standing order is irrefutable. You don't say what sort of work you will be doing but if it's a responsible job like dealing with money don't sell yourself short. You said business was picking up, you may be needed for more than 10 hours pw. Again don't sell yourself short, make sure your husband pays you what you are really worth to him, it's in both your interests
I take it you don't have any other paid employment?

Lizzieb151

Thanks - I don't have any other job. The 10 hours fits in with when our youngest goes to nursery. I won't be able to increase hours until she starts school next year.
I do his banking, paying bills and raising invoices, quotes etc etc over the 2 days she is at nursery.

xylophone

http://www.hmrc.gov.uk/childbenefit/start/claiming/protect-pension.htm

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181237/single-tier-pension-fact-sheet.pdf

Do you and your husband have private pensions? http://www.hmrc.gov.uk/incometax/relief-pension.htm

Lizzieb151

Thank you - we don't currently pay into a pension although we both have ones that we could do I believe - I will need to check it out.

Prothet_of_Doom

My wife is employed by my ltd company to do basic book keeping, admin, and 'stuff'. I'm registered as an employer, and use the HMRC's own simple software, which is designed for small businesses. It's a fairly clunky bit of software, but we've managed to get it to spit out each of us a .csv file monthly, which is a payslip, that is then tranferred into excel. Payment goes from business account into our joint account, and every 3 months I have to pay the NI and PAYE to HMRC.
It's not hard once you get your head around it.

zygurat789

Prothet_of_Doom wrote: »

My wife is employed by my ltd company to do basic book keeping, admin, and 'stuff'. I'm registered as an employer, and use the HMRC's own simple software, which is designed for small businesses. It's a fairly clunky bit of software, but we've managed to get it to spit out each of us a .csv file monthly, which is a payslip, that is then tranferred into excel. Payment goes from business account into our joint account, and every 3 months I have to pay the NI and PAYE to HMRC.
It's not hard once you get your head around it.

Does that automatically cope with RTI?

purdyoaten

zygurat789 wrote: »

Does that automatically cope with RTI?

It does - I had a few clients who used it. Clunky is the word but it is free!

http://www.hmrc.gov.uk/payerti/payroll/bpt/paye-tools.htm