I am thinking to set up a UK Ltd company with my separated but reconciled wife, who is presently stuck (for complex family reasons) in Taiwan, where I am partly supporting her. She is Taiwanese citizen and not UK-resident. The company would sell my consulting/lecturing services and she’d do some back-office work. We’d be 50:50 shareholders and co-directors; profits would be paid out as equal dividends. I may spend some months per annum in Taiwan but would remain UK resident for tax purposes; the company would conduct no business in Taiwan.
If legitimate, this should be tax-efficient. My ‘ex’ would get dividends from the company, with, I believe, only Taiwan tax to pay, not UK. Simultaneously, I’d pull my own total income below the £100000 tax trap. The alternative –me continuing to consult as a sole trader, paying high marginal income tax rates plus NI, then remitting funds to Taiwan works out far worse.
But, is there a legal/tax pitfall that I'm missing?
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