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bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3921
Experience:  FCCA FCMA CGMA ACIS
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A tax question - I earn £60k and my wife earns £15k -

Customer Question

Hi - A tax question - I earn £60k and my wife earns £15k - we both work for the same company. If the company was agreeable to reduce my salary to £40k and increase my wife's to £35k - clearly that would have mutual tax advantages for us both. At face value, the new salaries are OK in market terms. I know that for savings - I can put all of its in my wife's name, and it be subject to basic rate tax ? Just wondered about in relation to our salaries ?
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.

Hello, I am Keith, one of the experts on Just Answer, and happy to help you with your question.

What the company choses to do in the matter of the remuneration of its executives is a matter for the company which is a separate legal entity in its own right. HMRC may not like it, but your suggestions is perfectly permissible, especially if you are both mere employees and not directors.

The treatment of savings by placing them under the lower paid spouse's control and name is ***** ***** as inter spousal transfers are outside the scope of UK taxation. The only danger comes if there is, in the long term, a marital split and the subesquent negotiations might prove interesting, to say the least!

I do hope that I have been of assistance to you with my answer.

Customer: replied 2 years ago.

Hi Keith - Many thanks for your reply, most helpful !

Kind regards

Ian

Expert:  bigduckontax replied 2 years ago.

Delighted to have been of assistance, Ian.

Please be so kind as to rate me before you leave the Just Answer site.

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