Hi all,
First time poster, so go easy on me.
I'm about to return to contracting after a 20 year break and am looking at how best to remunerate myself and my wife. We will obviously chat to an accountant about all this but we are at the very early stages of working out how this might work, just interested in some opinions from you guys initially to see if we are on a hiding to nothing with this. I did have a search but couldn't find something on this specific point.
We've formed a Ltd company and we are both directors and equal shareholders. Now... before you spit out your coffee , my wife will be contributing meaningfully to the business as she is a qualified accountant (but in a very specialised field so wouldn't be able to everything our business needs). The plan at this stage is that I will do IT contracts and she will support the business with its bookkeeping, payroll, admin etc. and then in a few months leave her current job and start to bring in revenue herself from her own billed clients.
I'm concerned that from what I know of my prospective client, I could well be deemed to be inside of IR35. On the upside though, my wife and I are both going all out on our pensions at the moment (as we are mortgage/debt free and both our kids are through uni) so in an ideal world the company would pay both of us a fairly modest wage then we would get up to the 95% allowed salary with hefty pension contributions. That way, we achieve what we want to (funding our pensions and minimising tax) and IR35 almost becomes irrelevant as even if we were challenged we would be within the rules.
My question (or at least my first one!) is...
My wife has a job/salary (and a personal allowance of course) in use at her current employer. Is it acceptable for our company to initially pay my wife (who is a director/shareholder, remember) only via company contributions to a pension, not paying her a salary at all? This could only be low level initially of course, as she will not be doing loads for the company.
Thanks in advance for any pointers.
Andy.T
First time poster, so go easy on me.
I'm about to return to contracting after a 20 year break and am looking at how best to remunerate myself and my wife. We will obviously chat to an accountant about all this but we are at the very early stages of working out how this might work, just interested in some opinions from you guys initially to see if we are on a hiding to nothing with this. I did have a search but couldn't find something on this specific point.
We've formed a Ltd company and we are both directors and equal shareholders. Now... before you spit out your coffee , my wife will be contributing meaningfully to the business as she is a qualified accountant (but in a very specialised field so wouldn't be able to everything our business needs). The plan at this stage is that I will do IT contracts and she will support the business with its bookkeeping, payroll, admin etc. and then in a few months leave her current job and start to bring in revenue herself from her own billed clients.
I'm concerned that from what I know of my prospective client, I could well be deemed to be inside of IR35. On the upside though, my wife and I are both going all out on our pensions at the moment (as we are mortgage/debt free and both our kids are through uni) so in an ideal world the company would pay both of us a fairly modest wage then we would get up to the 95% allowed salary with hefty pension contributions. That way, we achieve what we want to (funding our pensions and minimising tax) and IR35 almost becomes irrelevant as even if we were challenged we would be within the rules.
My question (or at least my first one!) is...
My wife has a job/salary (and a personal allowance of course) in use at her current employer. Is it acceptable for our company to initially pay my wife (who is a director/shareholder, remember) only via company contributions to a pension, not paying her a salary at all? This could only be low level initially of course, as she will not be doing loads for the company.
Thanks in advance for any pointers.
Andy.T
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