Can I employ my child in my business?

Getting your children to help in your business is a useful way of getting an extra pair of hands for you and can earn them some extra pocket money. The money that you pay them will also be a tax-deductible expense in the business.

There are strict rules you must adhere to when employing your children (someone below the age of 18).

A permit is usually required from the local council’s education department before you can employ someone below the age of 16.

Age limits:

• Under 13:
  • Cannot be employed
• 13-year-olds:
  • Can work part-time depending on local by-laws. There may be restrictions in place regarding working hours, conditions of work & type of work they can do.
  • You should check first before employing your 13-year-old
• 14-year-olds:
  • Can work part-time in areas considered ‘light’ (e.g office work, shelf stacking etc.)
  • Can work in a café or restaurant but not in the kitchens.
  • Children cannot work during school hours (except during weekends and school holidays) and can only work between 7am and 7pm
  • They can work up to 2 hours per day on school days and Sundays and up to 5 hours per day on Saturdays and during school holidays
  • They cannot work more than 12 hours per week during term time or 25 hours per week during school holidays.
• 15 – 17-year-olds:
  • The same rules apply as above except for the following:
    • They can work up to 2 hours per day on school days and Sundays and up to 8 hours per day on Saturdays and during school holidays
    • They cannot work more than 12 hours per week during term time or 35 hours per week during school holidays.

How much can you pay?

• 13 – 15-year-olds:
  • Not entitled to the minimum wage
  • Do not pay National Insurance so they only need to be included on your payroll if their total income is over their personal allowance
  • The rate paid must be commercially justifiable. It should be no more than you would pay a non-family member with the same level of skills and experience.
• 16- & 17-year-olds:
  • Entitled to the national minimum wage
  • If you are a registered employer, then you need to include them on your payroll.
  • If you are not a registered employer but they earn above the Lower Earnings limit (currently £123 per week for 2022/23) then you will need to register as an employer and submit payroll reports to HMRC.

Employing your children can provide a financial benefit for both your business and your children. Please get in touch with us today if you would like any guidance on this subject.