Reply to: Is this legal? Wife not paid directly...

[Jessica@WhiteFieldTax]

Im sure you are more likely to be correct with nmw than I.

I should have taken my tolerance pill this morning. There could be a number of reasons why it may not increase the overall tax take. If the wifes tax allowance is used elsewhere for example.

It might on the face of it appear odd. But tge details may be such as it isnt.

If you find the tolerance pills, lob some this way please...

[Jessica@WhiteFieldTax]

There might be in your eyes as you are a professional and have the knowledge of the system, you work with day in day out and are willing to push the boundaries as there is no risk on you. We look to the pro's to keep us safe and within the boundaries and not put our money at potential risk so we are looking over our shoulders all the time. I for one want my accountant to keep me in that safe zone, not use me as a tool to play the tax laws to the absolute limit. Surely at some point your advice should be 'it's risky don't do it' in grey and untested areas?

No, you misunderstand me.

There simply isn't enough detail to draw a judgement on facts given.

Really what we are discussing is no more than "my mate in the pub said"

[TSM]

Thanks for the replies. I agree I have no in-depth knowledge of her personal disability, so she may well be entitled to what she claims. At the end of the day it's not really my concern just an observation...
I know with my dealings with this individual he comes across to me as someone who knows the system...i.e. I know he has money in off shore accounts...that's not to say he has done anything illegal.His business partner is a chartered accountant by trade... Another thing he mentioned, which maybe should be another thread, but I'll write it here anyway, was how he set-up another company for a year to reduce his tax bill. This is what he told me. He sold his house for ~£800k. He bought a house near the coast, but because it needed a bit of work doing, he put his family into rented for a year and setup this company and put the house he had just bought as a "Holiday Home". He registered it with a letting agent. He got 8 weeks booked for that whole year...but he claimed for repairs to the kitchen, boiler repairs, bathroom, new fences around the property, garage roof etc etc....then year later moved in to his newly decorated and repaired home and claimed the expenses off his tax.
I can only go on what he has told me and TBH he might have embellished a few points, but i know he did this as I saw his house listed on the Holiday Home Company website at the time...
Interesting guy....

[SueEllen]

She has disability payments apparently because when she was 3 years old she had an op on her legs as they were not quite straight. She was in traction for 6 months or so...She now walks fine, albeit with a slight wonky movement...she even enjoys hill walking. I know she has a disabled badge and mobility scheme car...maybe it has to do with that?

Just because she walks fine in front of you and enjoys hill walks doesn't mean she doesn't have problems with her joints, bones or muscles.

Unless you have seen her full medical notes you cannot state whether she is or isn't entitled to it.

I know disabled people who are entitled to the same thing as she has but if they undertake a hill walk or a long cycle ride you won't see them for the rest of the week as they will be laid up in bed.

[ASB]

I'm fairly certain (as in very) that close daily relationships are NMW exempt like non contract directorships.

I don't think, without full knowedge, we can judge stupidity V savviness. There is often more than meets the eye.

Im sure you are more likely to be correct with nmw than I.

I should have taken my tolerance pill this morning. There could be a number of reasons why it may not increase the overall tax take. If the wifes tax allowance is used elsewhere for example.

It might on the face of it appear odd. But tge details may be such as it isnt.

[northernladuk]

I'm fairly certain (as in very) that close daily relationships are NMW exempt like non contract directorships.

I don't think, without full knowedge, we can judge stupidity V savviness. There is often more than meets the eye.

There might be in your eyes as you are a professional and have the knowledge of the system, you work with day in day out and are willing to push the boundaries as there is no risk on you. We look to the pro's to keep us safe and within the boundaries and not put our money at potential risk so we are looking over our shoulders all the time. I for one want my accountant to keep me in that safe zone, not use me as a tool to play the tax laws to the absolute limit. Surely at some point your advice should be 'it's risky don't do it' in grey and untested areas?

[Jessica@WhiteFieldTax]

It is illegal. She has to be paid NMW. Unless she is a director with no employment contract.

It is also incredibly stupid. In effect it would appear he is paying tax on an amount equivalent to her personal allowance unnecessarily.

I'm fairly certain (as in very) that close daily relationships are NMW exempt like non contract directorships.

I don't think, without full knowedge, we can judge stupidity V savviness. There is often more than meets the eye.

[ASB]

Just a quick question...I was chatting to a guy I do business with he has a LTD company with 2 directors.. Himself and a friend who runs the overseas office in Canada. He was telling me his wife runs the UK office doing calls , admin etc and works 6-8 hrs a day. However he does not pay his wife anything...instead he takes the salary she would earn and adds it to his wage bill. Money is then paid into their joint back account...I didn't really grasp why he would do this? I know she claims benefits for disability...so is this legit or is illegal?
Thanks
Nick.

It is illegal. She has to be paid NMW. Unless she is a director with no employment contract.

It is also incredibly stupid. In effect it would appear he is paying tax on an amount equivalent to her personal allowance unnecessarily.

As to the benefits angle who knows. Depends an the overall circumstances.

[jmo21]

If what you're saying is that she properly pays tax and her income is recorded through PAYE, but that to save a little bit of effort they make one payment to their joint bank account instead of two, then I don't see there's any problem with that.

He is clearly not saying that at all and they are cheating the benefit system by making it appear she is unemployed

[TSM]

Thanks for the comments. She is not PAYE, there is no record of her working at all on paper. I was more intrigued as to why a company would do this more than contacting a hotline. She has disability payments apparently because when she was 3 years old she had an op on her legs as they were not quite straight. She was in traction for 6 months or so...She now walks fine, albeit with a slight wonky movement...she even enjoys hill walking. I know she has a disabled badge and mobility scheme car...maybe it has to do with that?

[VectraMan]

If what you're saying is that she properly pays tax and her income is recorded through PAYE, but that to save a little bit of effort they make one payment to their joint bank account instead of two, then I don't see there's any problem with that.

[SueEllen]

People who are working get disability benefits as the point is to pay them the extra costs of going to work and getting around that an able person doesn't have such as taking taxis as they cannot see bus numbers, costs of a guide dog , costs of running a mobility car.

So unless you know exactly what benefits the disabled wife is getting don't bother sticking your nose in as the benefits fraud line gets lots of calls about disabled people getting benefits they are entitled to.

[Jessica@WhiteFieldTax]

Without knowing the details it could be completely legal if you're that worried ask the benefits office to look into them.

WSPS

[Sockpuppet]

Just a quick question...I was chatting to a guy I do business with he has a LTD company with 2 directors.. Himself and a friend who runs the overseas office in Canada. He was telling me his wife runs the UK office doing calls , admin etc and works 6-8 hrs a day. However he does not pay his wife anything...instead he takes the salary she would earn and adds it to his wage bill. Money is then paid into their joint back account...I didn't really grasp why he would do this? I know she claims benefits for disability...so is this legit or is illegal?
Thanks
Nick.

Without knowing the details it could be completely legal if you're that worried ask the benefits office to look into them.

[Sausage Surprise]