Section 660 and business diversification

Would it help avoid the pitfalls of Section 660 if my wife and I diversified the current limited company we have so that she is a significant income earner and contributor?

My wife and I are joint directors and shareholders in a limited company set up to provide my services as an Interim Manager. Currently she performs office admin functions (couple of hours a day) when I am away on contracts and helps with PAYE and the books, for which the business pays her a modest salary just below the £89 per week threshold for tax and NI. However, I am by far the main earner for the business.

This is our first year of trading and we had planned to be fairly conservative in terms of proportion of income taken out as dividends as opposed to salaries for IR35 reasons. We currently subscribe to FO35 and have followed the guidelines in setting up the business.

My wife is training to be a Complementary Therapist and planned to start her own business later this year as a self employed sole trader.

Could we diversify the services provided by the existing limited company to include what she will do - which would then make her a significant contributor to and income earner for the business - and avoid the pitfalls of Section 660, or would the Revenue look at what each of us does as two separate businesses and view them independently for the purposes of Section 660?

What is involved in changing the nature of an existing limited company?

-- cuillin