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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15940
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I my wife and I are both company directors. Last year we

Resolved Question:

I my wife and I are both company directors. Last year we took 53k dividend each my accountant has completed my tax return which is 12k problem it this is the first time we have drawn so much and I haven't completed a tax return for my wife before what are her options
Assistant: The Accountant will know how to help. Is there anything else the Accountant should be aware of?
Customer: She dwarfs 9k salary and we do pay cooperation tax I am concerned she may be in trouble with the hmrc
Submitted: 1 month ago.
Category: Tax
Expert:  TonyTax replied 1 month ago.

Hi. My name is*****'m looking at your question now and will post my answer or ask for more information here in a short while.

Customer: replied 1 month ago.
Thanks Tony my wife has been director for 10 years but we have always only taken small dividends to keep below the high tax band. I have paid small amounts of extra tax as advised but I do recive an army pension
Expert:  TonyTax replied 1 month ago.

Your wife should strictly have been registered for self-assessment at the time she became a director of the company. This may not be a problem if her salary was within the personal allowance and her total income including dividends did not exceed the basic rate tax threshold in the tax year she became a director and each tax year thereafter.

For 2016/17, the new dividend tax was introduced. Even basic rate taxpayers may have tax to pay on dividends as a result. I'd have the accountant check your wife's tax position for each tax year and then register her for self-assessment. If he does it over the phone, he may be able to persuade the tax official he speaks to only issue tax returns for the tax year(s) where there is tax to pay. That's a tactic which has worked for me in the past.

I hope this helps but let me know if you have any further questions.

Customer: replied 1 month ago.
Tony thanks just to confirm my wife needs to provide evidence to the accountant of all dividends drawn over the last 10 years. Then it would be the accountant who would speak to the tax official on her behalf before she complete a self-assessment. She have just begun the hmrc registration process and is waiting for the UTR before registering online should she now hold on this process and go directly to an account
Expert:  TonyTax replied 1 month ago.

I was assuming you had an accountant already.

If your wife registers for self-assessment and tells HMRC she became a director 10 year ago, she may receive 10 years tax returns to complete, maybe only 6. That won't really be a problem if she has no tax to pay. Clearly, an accountant will charge for completing tax returns. If your wife does them online, the tax calculations will tell her what her tax position is.

If you or your wife are confident about doing the returns, then go ahead. I think that she will only be able to complete the last 3 or 4 tax years online and the rest will need to be done on paper.

Customer: replied 1 month ago.
Tony great advice thanks. I do have an accountant who manages the company and my tax affairs and will more than like go through them
Expert:  TonyTax replied 1 month ago.

That would make sense.

Would you mind rating my answer before you leave the site please.

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