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Anyone with a part time nanny shared with another family got experience of pension auto-enrolment?

(11 Posts)
Quietlyalert Sun 13-Nov-16 10:34:59

Hi - just got round to reading the letter from the pensions regulator and as our nanny earns over £10k / year it seems we will have to start paying her pension. That's not a problem, however what I'm not clear on is that she also has another nannying job, which I've read can affect the amount that we need to pay etc. From advice online it seems that a nanny pay agency is the best way to make sure this is done accurately, however I've managed to avoid using an agency so far sorting out pay directly with HMRC, so reluctant to start paying out £100/year now for an agency services as well as the pension costs on top of that. before I make the inevitable phone call to HMRC, can anyone shed any light on this? I believe the amount we'd need to pay would be 2%, so would this be split between the other family, or would we each pay 2%? Thanks!!!

Karoleann Sun 13-Nov-16 12:22:24

You each pay 2%, but its only over the qualifying amount, which this year is about £5,500. The 2% is also shared between you and her, so you pay 1% and she pays 1% from her salary. It will go up at the end of 2017 though.

I set the nursery scheme up with a company called NEST and I found it quite straightforward (I have no accountancy qualification, but I'm used to doing a payroll). We used the payroll site for our payroll and its easy to add the pension stuff to it.

Feel free to PM me.

nannynick Sun 13-Nov-16 12:30:53

Your title says nanny share but you talk about a separate job. So is it a share, where you and another family jointly employ the nanny, or is it two separate jobs?

If two separate jobs, then only look at what you pay your nanny. Look at the gross pay - if that is £10,000+ then from your staging date you need to offer a pension scheme. What date do you need to offer a scheme from - the regulator has recently been sending out letters to employers whose scheme does not need to start until November 2017.

Do you have a gross or net pay agreement with your nanny? As you are doing payroll yourself, I would expect it is a Gross agreement... but worth asking just in case you have done it as Net. If it is net, then that means you will pay both the employer pension contribution and the employee contribution. If gross, then you just pay the employer contribution, the employee contribution is deducted from the gross pay in a similar way to how Income Tax and National Insurance are deducted.

nannynick Sun 13-Nov-16 12:36:28

NEST is a good provider to look at as they do make it as easy as possible for you as a small employer. You will need to make a note in your diary about sending the right letter at the right time to your employee, and continuing to do that if they decide to opt-out.

Employee contribution at the moment is 0.8% because NEST uses a Relief At Source scheme. www.nestpensions.org.uk/schemeweb/NestWeb/public/helpcentre/contents/how-should-i-calculate-tax-relief-with-my-earnings-basis.html

Quietlyalert Sun 13-Nov-16 12:37:27

Hello, thanks very much for the responses.

Karoleann, I will have a look at NEST and may PM you if I have any questions, thank you.

Nannynick - no, the nanny has two separate job, and she was employed with the other family before us, apologies that wasn't clear. Our staging date is actually October 2017, so I'm a month late already. We do payroll ourselves using the HMRC software and an online payslip software - it is a Gross agreement. Thanks for your advice, think I'm a bit clearer now.

nannynick Sun 13-Nov-16 12:39:29

Is that a typo or does the letter really say October 2017? If so, you are 11 months early smile

Quietlyalert Sun 13-Nov-16 12:41:05

okay, rather embarrassingly I've just realised it is currently 2016 and not 2017, so I have a few months to get all this sorted!! But the advice useful nonetheless.

nannynick Sun 13-Nov-16 12:42:08

So the other work your nanny has is not relevant. Your pension contributions are based on what you pay your nanny (gross wage), not what they earn from all their employment combined. Have a look at NEST, they have lots of help pages.

Quietlyalert Sun 13-Nov-16 12:42:30

(I blame baby brain!!)

Quietlyalert Sun 13-Nov-16 12:43:11

okay, that's super helpful. thank you again smile

nannynick Sun 13-Nov-16 12:47:22

As you have had the letter, you do need to do something... nominate a contact.
automation.thepensionsregulator.gov.uk/Nomination

Then once past the staging date you complete a Declaration of Compliance.
www.thepensionsregulator.gov.uk/completing-the-declaration-of-compliance.aspx

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