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Adam Hunt
Adam Hunt, Accountant
Category: Finance
Satisfied Customers: 451
Experience:  FCCA, FFA, FFTA
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I have just started a new company here in the U.K. and I

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Hi, I have just started a new company here in the U.K. and I want to register an employee for payrol. The problem is my company is not making much just yet that would cover his salary. So my sister will be transferring me the money for his salary every month even though she has nothing to do with company as he sometimes checks on her house as she abroad but the employees main work will be with my company. How would I go about doing this? Is it ok tax wise for her to just keep transferring this money to me to pay him every month? Thank you in advance!!Kind regardsJames

Hi I am one of the experts. She can give you a personal loan and you can sign an agreement with her. Then being the director of the company you can give loan to your company as is more straight forward. Once your company can pay this loan back then get it paid. Please do get all such loan agreements written and signed for in case.

Hope I have answered your question?

Customer: replied 10 months ago.
Thank you to your reply.So what happens if she wants to keep paying his salary every month? Could that not just go down as family support or a gift? Then I just loan that to the company every month?

It is a loan so you should return this loan back to her once you have to. Get an agreement signed with her please and then get this loan paid back afterwards.

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Customer: replied 10 months ago.
That’s what I’m trying to explain is that because she would also like this employees assistance now and then to check on her house she is willing to cover his full salary every month for as long as he is employed by my company and does not want the money returned so it is not a loan. How would this work?

In that case she should employ this person on her own name and pay his salary. So, you need to make sure that the employer is identified correctly.

So in nutshell, you need to make sure that if person is employed by your company then he has received salary via your company and if he is employed by your sister then he is given salary by your sister.

Customer: replied 10 months ago.
She does not want to set up company and go through all of that hassle as he is only assisting her occasionally but working for my company more but she insists on paying his full salary every month where I will add to and increase his salary in the future once company starts to bring in more. How would I go about handling this situation?

I respect your point of view however there is only few legal ways to get this done properly. So either this is your company's employee or her employee or may be this is shared employee between two of you but all of this should be written in an agreement and signed by both parties.

Hope now I have answered your question?