Nanny Cost - Example, 36 hour week

[nannynick]

Previously I have posted example costs for having a nanny and thought it's been a while since I last did that.

Would be interested in your views as to what is reasonable these days for the activity budget, average mileage, those sorts of costs which vary from family to family.

Rough costs:
nanny salary 36 hours per week at £12 gross per hour = £22,464

Employer pension contribution (3%)= £674

Payroll admin & contract=£265

Activity budget: If it was £2.50 per day per child then £960 per year (48 weeks).

If nanny uses their car to transport your children you pay mileage. £0.45 per mile. An average mileage of 60 per week maybe about right, small journeys add up. It can help to track your own mileage in your car for a while to get a reasonable view of what average mileage might be. 60 miles per week, £0.45 per mile, 48 weeks = £1296

Total so far: £25,659

Employers National Insurance: £1909

Then food whilst nanny is on duty (so probably lunch and afternoon tea depending what time your children eat in the afternoon/evening).

So rough cost to you as the employer is £27,568 so call it £28k.

The higher the salary to the nanny the more this will increase. When discussing salary with applicants ALWAYS discuss gross pay. Do not talk Net/Take Home pay. You do not want to be paying a nanny’s student loan or other deductions from salary.

I thought NI came out of gross pay?

Cyber
The employees NI comes out of gross pay.
But an employer also has to make NI contributions on top of that.

Cora is right, there are two different National Insurance payments that comes out.
Class 1 NI comes out of the employees gross pay.
Employers NI is paid by the employer, thus is a cost in addition to the gross pay.

The discussion should be about wages, not salary. Nannies are legally required to be paid per hour, which means they are paid wages not a salary. Nannies typically have guaranteed hours

Dencar are you in the United States? In the UK people are paid a gross annual salary and have a contract that states the working hours. The contract will also often include an overtime rate should the usual working hours be exceeded.