Income splitting in a partnership
Monsoon
Registered Posts: 4,071 Beyond epic contributor 🧙♂️
I know there was a discussion recently on giving wife shares in a company as a legitimate form of income splitting.
Is the same allowed in a partnership i.e. making the wife a partner even if she does nothing (assuming she has no other income)?
I know that to pay her 'wifes wages' the money needs to actually be paid and a paye scheme set up, and you'd need to demonstrate she did some work.
Do I assume correctly that if she is an equal partner, even if she does no work, that this is a legitimate income split?
I don't deal with partnerships very often, everyone here is either a sole trader or a Ltd (the client I have in mind doesn't want a Ltd despite the tax savings!) so my knowledge on them is a bit hazy compared to the other stuff!
Thanks.
Is the same allowed in a partnership i.e. making the wife a partner even if she does nothing (assuming she has no other income)?
I know that to pay her 'wifes wages' the money needs to actually be paid and a paye scheme set up, and you'd need to demonstrate she did some work.
Do I assume correctly that if she is an equal partner, even if she does no work, that this is a legitimate income split?
I don't deal with partnerships very often, everyone here is either a sole trader or a Ltd (the client I have in mind doesn't want a Ltd despite the tax savings!) so my knowledge on them is a bit hazy compared to the other stuff!
Thanks.
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