Paying my wife to qualify for child benefit

Hi there,
I hope I'm posting in the right place - would be really grateful for help with this.
My wife is employed (part-time), earning around £8,000 p/a. I'm self-employed, earning around £60,000 p/a.
I would like my wife to do a bit of work for my business. If I pay her (as a freelancer) around £12,000 p/a, can we then claim child benefit and reduce our tax bill without running into problems?
Thanks,
Sam

Comments

  • Guest101
    Guest101 Posts: 15,764 Forumite
    samcrows wrote: »
    Hi there,
    I hope I'm posting in the right place - would be really grateful for help with this.
    My wife is employed (part-time), earning around £8,000 p/a. I'm self-employed, earning around £60,000 p/a.
    I would like my wife to do a bit of work for my business. If I pay her (as a freelancer) around £12,000 p/a, can we then claim child benefit and reduce our tax bill without running into problems?
    Thanks,
    Sam



    Short answer is no. You are self employed, your income is over £50,000, how you spend that is irrelevant.


    If you had a company and employed yourself and her, then that would be different. But you would also be running a company.
  • Icequeen99
    Icequeen99 Posts: 3,775 Forumite
    Guest101 wrote: »
    Short answer is no. You are self employed, your income is over £50,000, how you spend that is irrelevant.


    If you had a company and employed yourself and her, then that would be different. But you would also be running a company.

    That's not correct - if he is self-employed as a sole trader an employee would be a legitimate expense that can be deducted before his tax is calculated just like any other expense. Or she could be self-employed and invoice him, either way it is deductible as a business expense.

    IQ
  • If the rules allow you to do this go ahead.
    These are my own views and you should seek advice from your local Benefits Department or CAB.
  • Darksparkle
    Darksparkle Posts: 5,465 Forumite
    You'll want to do a status check first to make sure she's genuinely employed or self employed so tax and nic can be dealt with appropriately. I also wouldn't say to HMRC that your pay her so you get child benefit.
  • TELLIT01
    TELLIT01 Posts: 16,364
    First Anniversary First Post Name Dropper PPI Party Pooper
    Forumite
    Wouldn't your accountant be the best person to advise on this?
  • A great attempt at a troll thread but no one is biting :)
  • theronstar
    theronstar Posts: 64 Forumite
    Are there often people who come along with hypotheticals in order to test forum members?
  • Cheeky_Monkey
    Cheeky_Monkey Posts: 2,072 Forumite
    In a word - yes
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