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Paying nannies for overtime – normal to payroll or cash in hand?

(16 Posts)
AndBingoWasHisNameOh Tue 23-Apr-13 10:50:54

I have a live in nanny. This weekend she is going to look after junior overnight for the first time whilst we go to a child free wedding. I called the (top end) London agency we hired her through to discuss what would be a suitable pay rate for this. Agency gave me a figures and I said “is that net or gross?” Agent said “well, it’s net I guess but well, depends what arrangement you came to.. you know....”. So clearly expectation that you would give cash in hand.

Our nanny hasn’t done much overtime for us but when she has we’ve put it through payroll. She seemed surprised at this and a bit peeved that legally tax applied to overtime as well as regular pay so I suspect previous employers have done cash in hand. Crunching the numbers grossing up the figures for the overnight cost about 50% more than just giving cash so sort of tempting.

Anyway, do most nanny employers put overtime through payroll or give cash under the table because I’m currently feeling in a minority of one.

nannynick Tue 23-Apr-13 12:45:57

I usually get time off in lieu, that way payroll stays the same.

OutragedFromLeeds Tue 23-Apr-13 12:56:09

I think the vast majority pay cash in hand. I've been paid cash in hand for overtime before now. It's not right though. I think people look on it as babysitting and I don't know anyone who pays babysitting through the books. It's up to the babysitter to declare their earnings.

Seb101 Tue 23-Apr-13 13:30:19

Pay her cash in hand!

AndBingoWasHisNameOh Tue 23-Apr-13 13:53:06

time off in lieu not an option here - she wants the money

Blondeshavemorefun Tue 23-Apr-13 15:29:03

you cant have it both ways - you say that when you nanny has done overtime you have put through books hence nanny gets less and shes a bit peeved - fair enough

now you have worked out how much it will cost you to put through books and you arent happy to pay the extra to gross it up - again fair enough

why didnt you pay cash for overtime - to save you the extra and so the nanny doesnt get less?

most people pay cash for overtime therefore no one needs to know ie the tax man

obv it is illegal to not declare all income so sure some on here wont admit they pay cash

im not telling you to do the above as illegal (blondes looks after her own butt wink) but what happens between you and your nanny via cash then no one the tax man needs to know

Mine gives it to me in cash, I put it through my self assessment as babysitting as it is technically babysitting.

Reinette Wed 24-Apr-13 02:52:32

I'm paid for OT via payroll, it never occurred to me to expect cash in hand. That being said, it does seem very common, so if it made you both happy (saves you both money)...

drinkyourmilk Wed 24-Apr-13 06:37:50

In my current position everything including babysitting goes through the books.
In the past overtime has gone through the book, babysitting cih.

NomDeClavier Wed 24-Apr-13 07:28:33

No one needs know until the nanny gets peeved and reports it....

It happens when jobs end badly, unfortunately, so I wouldn't personally take the risk.

Blondeshavemorefun Wed 24-Apr-13 07:44:05

I rem the wedding thread bingo - a child free wedding means a huge expense for you on top of hotel pressie new outfits etc

Tbh if you are doing everything else legally ie paying her tax out of her gross wage (as you are) then cash for extra work can't be traced or proved wink

But needs to be cash and not put in her bank account or cheque

AndBingoWasHisNameOh Wed 24-Apr-13 16:26:05

Hmm, good to hear that some others have put it all through the books as I was starting to think I was the only one who bothered! The very limited overtime to date I'd put through payroll as it hadn't really occured to me that you'd do anything else.

I think we'll probably just payroll it and structure it so that amounts that the nanny gets post tax are still reasonable - whilst it is tempting to avoid the extra costs the additional to us is probably a couple of hundred a year max and not sure it is worth running tax risk over.

Trying2bMindful Tue 30-Apr-13 00:04:34

Don't forget the tax man has publicly stated he is looking at people who employ nannies and coming down hard on anyone fiddling the books.
If you already put over time through the books then why not carry on. You don't really want to set a precedent as it leaves a sense of uncertainty about future overtime. It might be more expensive but at least you know you hve nothing to hide from the tax man.

AndBingoWasHisNameOh Tue 30-Apr-13 09:26:33

I spoke to Dh about it. His initial reaction was happy to pay cash in hand but when I pointed out I didn't think it worth the risk to save a relatively small amount per year he agreed and we're going to payroll it.

forevergreek Tue 30-Apr-13 09:34:33

Always payroll. as a nanny who's overtime can include a few weeks proxy parenting at a time, the amount paid puts my income into a bracket suitable for the mortgage we would like. A simple £50 for one eve babysitting a week adds up to £2600 a year. I think tax should be paid

HappyAsEyeAm Tue 30-Apr-13 15:35:00

We always pay our nanny any overtime through payroll. Under her contract, she is paid her normal hourly rate for any overtime. We wouldn't do it any other way, but our very experienced nanny says we are her first employers ever to not pay cash in hand for overtime.

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