If you own a small business can you hire family members without paying taxes on them?

Answer 1

what country are you in?

tax laws are different in different countries.


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In general, the tax collector wants his due no matter where you are or who is doing the work. Failing to report and pay is usually a crime, not to mention the tax penalties imposed [past due taxes, interest on them, and penalties for non-deduction are common].

AND, at least in America, the only tax you actually dodge on family members' work is the unemployment tax. Small businesses are usually taxed as if the sole proprietor [owner -- you] is the only employee and the net income is all his/hers -- so FICA, Medicare, and income tax all apply to the entire net income of the business. This is calculated and reported on your Schedules C and SE to your form 1040 income taxes.


Telling the truth is usually the better route -- ignore these guys up above who think you might get away with something here.

Answer 2

Taxes is a broad term. Are we talking about income tax only? If that's your question, then the answer is "yes"!!!! A definite "YES"!!! You calculate their tax base and 1099 them at an amount that they have no tax to pay. Every little bit helps, I know what you're after. The common idea in business is to spread the money out so you don't end up in a higher tax bracket. Also, use IRA's and every other way to keep your income out of those tax brackets which make us all have sleepless nights. Good luck.

Answer 3

Doesnt' matter if they are family or not. If they receive pay as part of working for the business, they are employees just like any other employee.

There are a couple ways around this but they tread on shaky ground.

Answer 4

Not on the books, that's illegal.

But you can get them to "volunteer" at your business and in exchange you get paid and then pay them out of your pocket an "allowance" but either way you'll be paying taxes, only it'll be on your taxes.

Best to keep honest.

Answer 5

No. You are required to pay taxes on all employees. The only way to not pay taxes on them is to keep them off the books and not official employees.

Answer 6

To me, Biden is so needless to say the best person to be president. Edwards incredibly has not greater experience than Obamma yet they the two look have some megastar-potential. If Sen. Clinton is nominated, i ought to nicely vote for a Republican for the 1st time on the grounds that I registered in 1972.

Answer 7

You can't "hire" them, you all can work as a whole family to the business if you catch my drift wink wink.

Answer 8

no