As an accountant working exclusively with small, owner managed businesses, we are often asked can I employ family to save tax?

Well the simple answer is yes – however you must be careful to ensure that they have a “proper job” and the arrangement must be on a commercial basis and the level of pay commensurate with the duties performed. i.e. you can’t pay your husband £40k a year just to open the post!

You also need to take into account things such as National minimum wage and income the family member has from elsewhere.

By employing family members, you can reduce your own exposure to tax and reward them for the efforts they put into the business.

If you would like some help with payroll, or how to structure your small business, click here to contact us.