Can someone advise on this scenario....
Wife lends 1,000 to husband to fund a new business
Business pays interest to wife
Wife declares interest income on tax return and so pays tax on it at her
marginal rate. Husband declares interest cost on his return (business is
sole trader) and so obtains tax relief
Is this what would happen in practice or does the fact that they are married
affect things at all ?
- posted 17 years ago