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TaxRobin
TaxRobin, Tax Consultant
Category: Tax
Satisfied Customers: 15888
Experience:  International tax
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Afternoon I have a client who wishes to pay his wife £20

Customer Question

Afternoon

I have a client who wishes to pay his wife £20 per week for bookkeeping services. This will keep her total income within her personal allowance.

Givern this is such a small amount does he need to register with HMRC?

I assume he will not need a payroll system or have to submit RTI?

Please confirm, thanks
Submitted: 4 years ago.
Category: Tax
Expert:  TaxRobin replied 4 years ago.
Hello and thank you for posting your question.
You are correct in that the employer/spouse would not need to register but he would want to make certain that the remuneration is at a reasonable market level for the work that is being completed. I am sure you explained this to them and cautioned that they would not want to be seen as distributing income from the company tax free.
Keeping an actual log or time book showing the work completed would assist in showing that there was no need to hire an unrelated person to do the tasks.
Thank you again and best wishes.
Customer: replied 4 years ago.


Hi


 


Should the wife register for a Self Assessment form?


 


Thanks

Expert:  TaxRobin replied 4 years ago.
Hello,
The employer would want to complete the P46. This would show the employment and alert HMRC of the situation. The spouse will need to register so relief is allowed for the income.