If you're a parent considering hiring a nanny, you may have found there is more to consider than first meets the eye!
Nannies are official employees, and as such you are legally required to fulfil professional employment standards. That means you need to provide an employment agreement, be clear on hours, salary, holiday pay, sick pay, annual leave, etc., and organise nanny tax. Your nanny is legally eligible for standard employment rights such as redundancy pay and a workplace pension.
NET OR GROSS WAGE ARRANGEMENTS FOR NANNIES
There is a lot of confusion around whether to offer your nanny a net or gross salary. Along with other industry leaders, we highly recommend you to implement a gross salary nanny tax arrangement with your nanny.
If you agree a net nanny salary, you are in the firing line to absorb all of the additional costs that build up over time as a nanny employer. For example, if you agree a net rate of £350 per week, you will be liable to pay NI on top of that. If the NI rate increases, you will be liable to pay for the increase, as your nannies net rate is set.
If you had agreed a total cost (gross) of £450 for example, then this will include your nanny's PAYE. This is just one small example of how a gross rate benefits the employer.
THE GOOD NEWS
The good news is that once you're all set up as an employer, it's easier than you might think to administer a nannies employment. You can organise nanny payroll and tax yourself, but for a relatively small fee you can get a nanny tax agent to do it for you, so you don't have the hassle of the paperwork.
KiwiOz Nanny Agency London works with a reputable nanny tax partner to deliver our families an industry leading tax and payroll service. To find out more, please contact us today for a free, no obligation chat about your needs and how we might be able to help.
We look forward to hearing from you!
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