I'm wondering how paying my children’s private school fees from my limited company will be affected once they both become employed by my company (once over the age of 13 and within reasonable allowed hours). For example, I understand it is currently considered a benefit-in-kind (BIK). Also, I am considering doing a university degree. As joint director of my company along with my husband, how can I make this work efficiently from both personal and corporate tax points of view?  

Arthur replies: 

The payment of your children's school fees by the company will continue to be treated as an employee BIK; see HMRC’s Employment Income Manual at EIM30000 and EIM30001. Due to the 'fortuitous' rules (see EIM30004, and note EIM30002), your situation does not qualify for the exemption. See also EIM06245. The question is, however, after your children become employees of the company, will the BIK be attributable to you or to your children? See HMRC’s guidance at EIM20505, from which it appears that the BIK will be attributable to your children. But a word of warning – don't be surprised if HMRC wants to challenge you and attribute this BIK to you by claiming that your children, especially those under 16, are not 'real employees'.