Income splitting with girlfriend (not spouse)

**NotAllThere** · 6 June 2021, 20:40

Arctic is concerned with dividends.

Marriage brings legal benefits. The ability to share income with her is one of them (as is spousal tax-free inheritance). Down side is that she gets some entitlement to your assets if you divorce.

*"*%ing about with share holdings and rights makes little differencw. So, your choice. Marry or put up with it.

There is no problem with paying your girlfried as an employee of the company and deducting appropriate PAYE, erNIC and eeNIC.

**Lance** · 7 June 2021, 09:17

if you are considering a commitment of a percentage of your business and future earnings, then why not consider getting married?

Forget the romance.. It's a contract between two people to share everything, and has the benefit of being recognised in law with certain protections (both ways).

**northernladuk** · 7 June 2021, 09:23

You really are better off discussing this with your accountant. They will know your situation much better than us and can advise the pros and cons more accurately.

But, IMO, keep your girlfriend out of it. We've plenty of threads where this has ended badly for people. We've enough threads just about married people let alone unmarried although in this day and age actually been married compared to unmarried is starting to merge. More and more people don't get married and can still be together for life... but lets take the assumption (until told otherwise) your girlfriend is not yet a life long commitment.

If it's not then don't give her half your money. When the relationship goes wrong, so will your finances.... big time. Might seem like a nice earner for now but it won't be when it goes wrong.

**northernladuk** · 7 June 2021, 09:24

Originally posted by NotAllThere View Post

There is no problem with paying your girlfried as an employee of the company and deducting appropriate PAYE, erNIC and eeNIC.

Except when it's just a tax dodge and she isn't doing a single thing for the company... which is probably the case.

**LondonManc** · 7 June 2021, 09:37

Originally posted by northernladuk View Post

Except when it's just a tax dodge and she isn't doing a single thing for the company... which is probably the case.

Even though the OP has said she does, which is why someone else suggested employing her instead of the usual married shizzle? Come on, read the thread.

**Craig@Clarity** · 7 June 2021, 09:58

Most questions can be answered with a "yes you can". How to account for the tax aspect of it and admin is usually the follow up. In your case, you can make her an equal shareholder. You're approaching it from the position she is doing significant work for the company and you'd like to retain her services. As others have mentioned, you could simply put her on a salary (get a contract of employment issued). If you want to make her a shareholder, as you say, you'll need to value the shares. How much can I buy a share in your company? Valuation can be subject but perhaps look at a percentage being applied to annual turnover or the balance sheet figure. Then complete a share transfer form, get her to pay the money over to you, pay the stamp duty if applicable and get a shareholders agreement in place. The shareholders agreement will protect the business and yourself in case anything happens in the future.

**northernladuk** · 7 June 2021, 10:10

Originally posted by LondonManc View Post

Even though the OP has said she does, which is why someone else suggested employing her instead of the usual married shizzle? Come on, read the thread.

They all say they do.

**BigLadFromBeeston666** · 7 June 2021, 10:36

Originally posted by Lance View Post

if you are considering a commitment of a percentage of your business and future earnings, then why not consider getting married?

Forget the romance.. It's a contract between two people to share everything, and has the benefit of being recognised in law with certain protections (both ways).

Yes, it's a good point. I'm proposing this month and we will likely be married at some point next year. COVID has delayed a lot of our plans. My intention is to stay together with her until death do us part, so the business has very much become a family endeavour. She has given up her career to raise our children.

Thanks all for the comments. I've been using FreeAgent to date, but it seems like an accountant will be worth spending a bit of money on to get this sorted correctly? I was going to use your referral code for Gorilla Accounting northernladuk, until you doubted my honesty

Craig@Clarity is it fair to assume this is becoming a more common set up for your clients? Marriage seems to be on the decline and co-habiting on the rise. Wondering how many people have had a similar idea.

**Lance** · 7 June 2021, 10:44

Originally posted by BigLadFromBeeston666 View Post

Yes, it's a good point. I'm proposing this month and we will likely be married at some point next year. COVID has delayed a lot of our plans. My intention is to stay together with her until death do us part, so the business has very much become a family endeavour. She has given up her career to raise our children.

Thanks all for the comments. I've been using FreeAgent to date, but it seems like an accountant will be worth spending a bit of money on to get this sorted correctly? I was going to use your referral code for Gorilla Accounting northernladuk, until you doubted my honesty

Craig@Clarity is it fair to assume this is becoming a more common set up for your clients? Marriage seems to be on the decline and co-habiting on the rise. Wondering how many people have had a similar idea.

why not use my referral code for Gorilla then?

Income splitting with girlfriend (not spouse)