Auto-enrolement and wives again

Is PAYE prima facie evidence of employment ?

Didn't find your answer?

My wife is paid through my company and has no need of a further pension so I tried contacting TPR to ask whether we could avoid registration becuase she doesn't have a contract. The reply was merely the stock answer that a worker is one who has entered into a contract. - which may be verbal or written. I'm an accountant so I know all that and have read the threads on this but is there a get-out here - although she is paid through PAYE (£80k) this is just to ensure that she can be remunerated as she is neiher a director nor shreholder. I suppose that I can make her a director to avoid AE but my question is - is PAYE prima facie evidence of an employment contract so could I argue that I have no employees as this arrangement is just for admininstrative convenience? As a number of commentators have noted - just do it and then opt out, but what a waste of time.

Replies (11)

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counting
By Counting numbers
23rd Jan 2017 15:17

There's info here on husband and wife companies. Might clarify for you - http://www.thepensionsregulator.gov.uk/director-exemptions-from-automati...

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Euan's picture
By Euan MacLennan
23rd Jan 2017 16:02

I think you have misunderstood the rules.

The 'not under a contract of employment' exclusion applies only to directors, which your wife is not. She is therefore an employee - a worker under the terms of s.88 Pensions Act 2008 - a jobholder under s.1 who must be auto-enrolled under s.3 as she is being paid more than the threshold of £10,000.

If you appoint her as a director, she would be entitled to the exclusion under s.90 because in the absence of any 'implied or verbal' clause, the term 'employment contract' must be construed in its normal sense of meaning a written contract explicitly approved by both parties.

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RLI
By lionofludesch
23rd Jan 2017 16:08

As Euan says, because she's not a director, you must enrol her in a scheme and - if she wishes - she can opt out.

Assuming, of course, that she's neither too old nor too young to qualify.

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Replying to lionofludesch:
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By kiwilondon99
25th Jan 2017 10:55

Client = Dir + shareholder, wife is not director nor shareholder, but is Co secretary.

Wife is aged such that she is drawing STATE pension . Company occassionally makes salary payment to her.

So in these circumstances are you saying NO AE scheme required when a salary payment is made to the wife

Co staging date is apparently nov17

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Replying to kiwilondon99:
Euan's picture
By Euan MacLennan
25th Jan 2017 12:03

If she is over State Pension Age, she does not have to be auto-enrolled into a pension scheme, so the company would not need to set up an AE compliant pension scheme, regardless of the level of pay, unless she takes leave of her senses and decides to opt in.

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Replying to Euan MacLennan:
RLI
By lionofludesch
25th Jan 2017 12:06

If she opts in, she'll double her money.

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By hje
23rd Jan 2017 16:55

Just think, in the time taken to write all that down and have a moan, it could have been done.

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Replying to hje:
RLI
By lionofludesch
23rd Jan 2017 17:02

Indeed.

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By Matrix
23rd Jan 2017 21:54

Don't you trust her with shares?

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By Paul FD
25th Jan 2017 13:37

Just want to thank all those specially Euan (thanks for ref to pension act) for taking the time to reply. The reason my wife won't opt in is becuase she is already hitting the lifetime allowance although far from pension age. My question was about the definition regarding employee/worker/job holder and if being on PAYE forces you to adopt them and their attendant compliance issues including AE and that has been answered so thank you. Yes, I pay my wife but I don't "employ her" - I don't control her and she makes none of the usual employee claims on me but it would seem that the law doesn't see it that way - rightly so for 99.9% of cases. This was about how we contract or, rather, agree not to contract with each other simply becuase we chose to use a salary for extracting funds. Thanks again for help and input from all.

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By aburt01
25th Jan 2017 16:29

Despite all that AE is supposed to be simple to administer; a post-holder is not a worker. Not a worker, no need for AE. Forget husband / wife small co special case, any post-holder (non-worker) such as a parish councillor or whatever, even with payments going through the PAYE scheme, does not require AE.

I refer you to...
http://www.thepensionsregulator.gov.uk/docs/detailed-guidance-5.pdf

Page 30
Worker An employee or someone who has a contract to perform work or services
personally, that is not undertaking the work as part of their own business.

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