Sole Trader, sub-contracting work to girlfriend who is also sole trader

thisuseridistakenagain

I don't see an issue with this. If you would do it with a friend then why not a girlfriend. It's two different businesses.

Suarez

looknohands wrote: »

My current profit as a sole trader is £55k

Why have you not registered a Ltd company?

getmore4less

IF this is because there is too much work won't your income still be high er than it would be if you just transferred the work to OH?


If both in similar areas it might be worth looking at restructuring to give growth potential.

MacMickster

You may need to consider VAT implications in addition to income tax.

If you are (or should be) VAT-registered and your girlfriend is trading below the VAT threshold then she can't charge you VAT on the work that she does for you. You won't be able to reclaim the VAT inputs on any of her overheads, but will have to charge the VAT on the full contract cost to your client.

Alternatively, you increasing her turnover may push her over the VAT registration threshold.

If neither of you are VAT registered then the VATman may be suspicious that you are operating a single business, but splitting the turnover to avoid having to register for VAT.