I am looking for a general steer before I pay my tax advisor for some more detailed advice
Here is my thinking.
My wife and I moved back to the UK on 5 April 2018 after a long time overseas so we will be fully tax resident for 2018 / 2019.
We have income as follows:
1. Consultancy income for me c. 200-300k per annum which will come through a limited company in which myself and my wife are 50:50 shareholders. I may only have this source for another 12 months.
2. Pension income for me from a previous employer of c. 100 k per annum.
3. Investment income c. 30-40k per annum.
Around 75% of the investments are in my wife's name and that is her only source of taxable income.
My challenge is - what to do with the consultancy income to optimize tax?
My simple answer is simply to take the money out of the company as dividends to make full use of my wife's basic rate band.
Given that the consultancy income will only be short-term and assuming we make 250k in the next 12 months I would aim to take the dividends in 3-4 installments over the next 4 years i.e. c. 80k per annum split between us.
Is there any merit in paying my wife a salary from the company - but not myself? Can I do that?
We will use our full ISA allowance to shelter as much income as possible but given we will have no earned income I assume there are no other ways to shelter assets/income (e.g. via a SIPP?).
Appreciate any thoughts
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