Income Shifting - What is allowed

Hi,

I have researched this topic and have found quite different opinions on the subject and have also read HMRC are clamping down on various different income shifting methods.

Could someone clarify if this is allowed.

I am a director in a small limited company and own a percentage of shares in the company. (ordinary shares).

The dividends I receive will be subject to 25% tax as I am in the 40% bracket.

Would I be able to transfer these shares to my wife who only pays 20% tax thus we wouldn't have any tax to pay on the dividends.

A small extract from a recent article I found seemed to suggest this is ok.

"Transfer of shares option

Assuming your spouse pays tax at a lower rate than you, then giving them shares in your company so you can pay them dividends is usually the most tax-efficient route to save tax and NI. The good news is that earlier this year HMRC confirmed that, as far as it was concerned, giving assets to your spouse to reduce your income or capital gains tax bill wasn’t an abuse of the tax rules."

Opinions would be welcome as I don't want to break any rules.

Cheers
Paul