Replies to Queries - 2

17 April 2002

Issue: 3853 / Categories: Forum & Feedback , IR35

Remunerating the spouse

A professional man is working as a self employed consultant. His wife provides genuine computer secretarial and administrative services. She has previously been remunerated by a salary less than the annual tax and National Insurance contributions threshholds but an executive pension scheme is in operation for her eventual benefit.

Due to an upturn in business it is intended to increase the wife's income share and this can be justified on practical and time grounds. Have readers any suggestions as to the best method of dealing with this? Formation of a company is out of the question because of the IR 35 legislation. Should the consultant just 'bite the bullet' and operate pay-as-you-earn for his wife alone? On the face of it a partnership could prejudice the existing pension scheme and might offend the regulations of the professional institute.

(Query T15 989)...

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