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Additional Income - paying my Wife for work done

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  • 21-10-2020 10:45am
    #1
    witnessmenow
    Registered Users Posts: 6,999 ✭✭✭


    Hello,

    I'm a PAYE worker on the higher rate of tax. My Wife is a stay at home Mam with no income. (we do get the carers allowance tax relief, not sure of the name of it)

    In 2018 I started making additional revenue through YouTube and selling items online (turn over between 5K and 15K per anum)

    My wife does work on the selling items online part, she packages the items up, puts them in the envelopes and posts them in the post office. On average she spends 4 hours a week working on this side of things.

    We spoke to an accountant last year about our situation and paying her for her time. Originally we thought the accountant said that it would be possible, but after talking to him this week about 2019, he said it wasn't possible to do that. (2018 was loss making, so it wasn't an issue)

    He was saying that I would have to pay tax on the profits and pay her from that. Is this true? I wouldn't be able to generate this revenue without her help wit it and it seems strange to me that I couldn't even pay her minimum wage for her time spent.

    He was saying if we incorporated or setup a partnership (I can't really remember what this one was) that it would be possible, but the turn over wasn't big enough to justify it.


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  • Options
    #2
    exaisle
    Registered Users Posts: 2,673 ✭✭✭exaisle


    How much is your taxable profit for 2019?

    witnessmenow wrote: »
    Hello,

    I'm a PAYE worker on the higher rate of tax. My Wife is a stay at home Mam with no income. (we do get the carers allowance tax relief, not sure of the name of it)

    In 2018 I started making additional revenue through YouTube and selling items online (turn over between 5K and 15K per anum)

    My wife does work on the selling items online part, she packages the items up, puts them in the envelopes and posts them in the post office. On average she spends 4 hours a week working on this side of things.

    We spoke to an accountant last year about our situation and paying her for her time. Originally we thought the accountant said that it would be possible, but after talking to him this week about 2019, he said it wasn't possible to do that. (2018 was loss making, so it wasn't an issue)

    He was saying that I would have to pay tax on the profits and pay her from that. Is this true? I wouldn't be able to generate this revenue without her help wit it and it seems strange to me that I couldn't even pay her minimum wage for her time spent.

    He was saying if we incorporated or setup a partnership (I can't really remember what this one was) that it would be possible, but the turn over wasn't big enough to justify it.


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