Employing the children

Produced by Tolley

The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Employing the children
  • Definitions
  • Taxation of minor children
  • Remuneration paid to proprietor’s children - tax deduction
  • Shareholdings distributed among family members

Employing the children


In income tax legislation, the term 'child' refers to offspring, ie it includes adult children. Children under the age of 18 are indicated by the terms 'infant' or 'minor'. In Scotland, the term ‘infant’ means a person under the age of 16. The definition of a child includes an adopted child and an illegitimate child. See Simon’s Taxes E5.201.

Stepchildren are specified as being within the definition of ‘child’ in various provisions of the tax acts. For example, the settlements legislation brings stepchildren within the definition of child by virtue of ITTOIA 2005, s 629(7)(a). However, there is no general provision that a stepchild is regarded as a child for the purposes of the taxes acts. Therefore, unless specified within the rules it may be necessary to consider the implications of whether a stepchild is a child or not.

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