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, its 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 hasnt done much overtime for us but when she has weve 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 Im currently feeling in a minority of one.
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.
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.
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.
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.
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
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.