advice on new Limited company

johnllew

NeilW wrote: »

I wouldn't do that at the moment. You are likely to fall foul of the new 'income shifting' legislation proposed in the next budget (which will effectively move anything you pay your spouse back onto your own tax bill) and believe me you really don't want to do that.

Do not the Income Shifting proposals concerning companies relate only to dividends and not remuneration?

CannyJock

Cook_County wrote: »

The income shifting proposed legislation will make this impossible from 6 April.

Just read the consultation document.

Absolutely lousy piece of legislation.

skyjumper

thanks to all who took the time and effort to answer this.

cook county- answer to ur Q- yes she is entitled to work in the UK under my visa regulations.

no- we r not claiming ANY child benefits whatsoever

i will try exploring about the income shifting rule
i was hoping to pay apprx £ 425 to her account as a salary for working approx 70 hours/Month.
am i legally right in giving her few £'ss for taking care of our baby- we dont send her to any nursery yet, and my wife is taking care of her full time- i know sounds stupid- but i guess if i dont ask - i will never know right

LittleVoice

I cannot see that paying your wife specifically for caring for your child being permissible as a deduction from your profits.

I believe that if you were to provide childcare vouchers for use with a registered childminder, this could be allowed but I have not checked whether these are taxable or at what level for employees.

Company Secretaries can be employees as well as office holders.

As from 6 April, private limited companies will not be required to have a Company Secretary though their duties will have to be done.

Cook_County

skyjumper wrote: »

no- we r not claiming ANY child benefits whatsoever

You are losing free money to which you are entitled. Claim Child Benefit (she cannot, but you can and should).

chappers

you can't pay her for child care but you can pay her for doing work for your company, as I said pay both her and yourself, salaries up to your personal allowances and take your money out in dividends.As long as your company profits are below £300K you will only pay corporation tax at 20%.
There is no income shifting issue here this is paying your wife for her work not sharing profits in the company,provided you pay her an acceptable wage for the work she does you are fine.

Word on the street seems to be that to a certain extent the government are going to do a bit of a backtrack on this and the legislation isn't going to be as restrictive as first thought.

tyllwyd

If your wife doesn't claim child benefit she will be missing out on Home Responsibilities Protection which would help to build up her entitlement to a state pension.
http://www.hmrc.gov.uk/childbenefit/cb-key.htm

skyjumper

Well Thanks tyllwyd,

i did go on the site and had a look at it. my personal circumstances do not allow me to get the C B either for me or my wife. i could explain this if anyone is more curious. i would take chappers advice in this and try to take the basic salary for myself and for my wife and hopefully do the dividends at the quarterly intervals. thanks to u lot

skyjumper

any more advice would be appreciated