Transferring your limited company shares to your spouse

Author: Russell Smith
September 28, 2015

One of the many tax advantages of a limited company is that you get a degree of planning around what your income is.

If you are employed or self-employed, your income is virtually set and then taxed on, not so in a limited company.

The best way to plan your tax in a limited company is to equalise your income in your household i.e. to make it that you and your spouse earn the same amount of money.

Two main reasons….

If you both earn £49,000, you’ll pay less tax than if one of you earns £98,000 and the other earns nothing.

Secondly, you will still keep child benefit if you both earn under £50,000.

The best way to do this is to transfer shares so that you can take equal dividends. You have to be careful at what ratio you do this as it depends on how much your spouse is earning but you will find that this will save you lots of tax

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