I have both PAYE and self employed income (sole trader) which brings me above the €45,400 income tax threshold (total c. €65k). My wife is a homemaker but assists me in my self employed business
I registered as an employer in 2010 and registered my wife as an employee (with effect from 1 October, 2010) so that I could allocate part of my self employed (consultancy) income to my wife to avail of a higher Income Tax threshold at the standard rate.
My question please - what is the maximum amount that I should allocate as a salary to my wife for 2010 i.e. the amount on which I should pay (deduct) PAYE and put on my 2010 P35 in order to mimimise my 2010 Income Tax bill (including levies etc). I understand that there is no liability to PRSI in respect of my employing my wife? The employment period was October to December, 2010.
Obviously the PAYE due in respect of my wife's salary will cancel part of the reduced Income Tax bill but I'm hoping that there will be a net tax saving
Thanks in advance
I registered as an employer in 2010 and registered my wife as an employee (with effect from 1 October, 2010) so that I could allocate part of my self employed (consultancy) income to my wife to avail of a higher Income Tax threshold at the standard rate.
My question please - what is the maximum amount that I should allocate as a salary to my wife for 2010 i.e. the amount on which I should pay (deduct) PAYE and put on my 2010 P35 in order to mimimise my 2010 Income Tax bill (including levies etc). I understand that there is no liability to PRSI in respect of my employing my wife? The employment period was October to December, 2010.
Obviously the PAYE due in respect of my wife's salary will cancel part of the reduced Income Tax bill but I'm hoping that there will be a net tax saving
Thanks in advance