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My wife is due to apply for her ILR after her 2 year qualifying period. Applying for her 8yr old daughter seems straight forward enough, but her soon-to-be 18 year old dependant son, will not have met the 2yr residancy rule, as he will have only been here 6 months when his visa expires. Where do we stand on this? Any advice? If he is living at home, studying part time and working part time, will that effect the situation?

Any advice would be appreciated...

For a dependent child, it's his age that's relevant at the time of the ILR application, not the length of residency (298). If he's under 18, then he may be included with his mother's SET(M) application. Else, he should use a separate SET(F) form.

See also Bringing your children.