Employing a Nanny

If you employ a nanny in the United Kingdom you have the same legal responsibilities as a commercial employer, therefore the law requires you to:

• Register as an employer
• Set up and operate a PAYE (Pay As You Earn) scheme on your nanny’s behalf
• Keep tax records on their behalf

• Provide your nanny with regular payslips 

• Provide them with an employment contract

• If your nanny earns more than £183 per week, pay National Insurance Contributions from their gross wage and also an employer’s National Insurance Contribution over and above their wage

• If your nanny earns more than £240 per week, pay income tax from their gross wage (on the assumption they only have one job with you)

• File an employer’s annual tax return

• Have employer’s liability insurance in place

• Enrol your employee within a qualifying pension scheme provided that they are eligible.

These obligations also apply:

• In short-term employment (i.e. a week or longer)
• To any employment taking place in the UK – irrespective of the country of origin of the nanny or employer

• Failure to file employer’s annual returns by 19 May can result in financial penalties
• Failure to pay all tax/NI liabilities before 19 April results in interest being charged on the amount outstanding
• Make sure your nanny is legally entitled to work in the UK – All UK employers are now required by law to make basic checks on every person they intend to employ in order to establish that they have a right to work in the UK and are here legally. These checks must be carried out on all potential employees whether or not you think they have a right to work in the UK by making assumptions based on their appearance or accent. You could face prosecution under the Race Relations Act 1976 and an unlimited fine if you do not ask all potential employees these questions

• Parental Choice is aware that all these legal obligations can be daunting and time consuming. We have working knowledge of the current employment laws and the tax system and have a team of skilled payroll services and legal advisors. We can advise you and arrange these nanny payroll services for you.