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Self-employed Nanny - Is this legal?(35 Posts)
Looking for some advice from experienced nanny employers.
I interviewed a 'nanny' last night (the '' are because she has no childcare qualifications, but she has a lot of experience and was highly recommended by a neighbour).
I had been told her rate was £8 per hour which is standard net pay for this area for qualified nannies.
On discussing this at interview she has said that she is 'self-employed' and therefore the £8 is effectively her gross pay, as she will be paying her own NI/tax out of it.
From my point of view it sounds good, as it makes her much much cheaper than I thought - but I was wondering if it was legal - I know that as an employer I would be expecting to pay employers NI as well as employees so should I still budget for that?
She is going to be employed by more than one family, so she fits the 'sole trader' inland rev. descripton...I'm just a bit concerned.
BTW she says she wants to be responsbile for her own NI/tax as her previous employers didn't pay hers so now she cannot claim Jobseeker's allowance etc. when her contract terminates - I felt really sorry for her.
if she's not a registered childminder (and it doesn't sound like she is), then I'm afraid she's a nanny and you should all be paying a portion of her NI etc.
a nanny can be self employed, my boss tried to get me to do it cos it svaes them money. Ask someone like nannypaye about it. lot of hassle for nanny but both parties can benefit financially.
Thanks FIS and NannyJo - she is def. not a registered childminder.
It's the nanny herself that wants to be in charge of her own tax/NI etc. She is doing a Business Cert. at evening school so might be non-plussed about the hassle involved.
I'll try nannypaye thanks - I would rather find someone else who I could pay like a 'normal' nanny than do something illegal.
Nannypaye website says that ' it is rare but not impossible for a nanny to be self-employed, so employers should check with the local tax office before employing them that they really are.'
So, it's possible, just complicated. <insert head banging wall icon>
If she is working for a number of different families it is possible she could meet the definition of self employed. however, you should bear in mind that if she doesn't pay her tax/NI then the Inland Revenue can deem that you have paid her net and come after you for the money. I would not employ her on a self employed basis without proof from the IR that they accept her as self employed. I'm not sure if you can get such proof - but the risk to you is quite high otherwise - not just the potentially unpaid tax but also fines, interest charges etc. I'm sure the girl is honest and would not deliberately mess things up but tax is complicated and if she does make a mistake you are likely to be the one that pays.
yes I would be surprised if she met the definition especially as she has to do the work herself and can be told when and where she has to work although I suppose it's not technically impossible. You can ask for a ruling but if they rule against the self-employed status, you and all the other families would have to cough up!
You can ask your local tax office. They should have someone who specifically deals with self employed status.
AFAIK there is no way to prove you are self employed (there used to be a certificate but this has been phased out now). However, if you draw up a contract that specified she is working on a self-employed basis (get legal advice for it) then I don't see what the problem is. Bear in mind you won't need to pay sick pay or holidays.
MrsW - you have put my fears into words so perfectly! I do not want to end up with a huge tax bill as a 'surprise'...and TBH if I want to spend £8 per hour NET on a nanny I want one with qualifications,,,even if she has got great references.
Back to the drawing board.....
youcan get around this, i wanted to be a self-employed nanny though got told that you couldnt. i got offered a job with a lovley family though they didnt realise they had to pay my tax and ni. i said i will look into it. because it is only partime i would need to work for sumone else and thought it would be abit awkward with ni and tax. i looked into it and i am classed as a HOMECARER. in this case you can be a self employed nanny. i am also on the ofsted voluntary register which cost 1oopound a year but you are ofsted registered which looks good and you can a number like childminders for working tax credits ect.
I think you still need to check this out further.
I am an Ofsted registered nanny and all ofsted registered nannies will be registered as a 'homecarer'.
There are quite a few issues surrounding nannies and self employed status. If you are working for one family regularly on set days each week you cannot be self employed. nannynick, I think, has more information on all of this.
Cherbear, alas it isn't that simple. Any nanny who is Ofsted registered is classed as a Home Childcarer. But that's not a taxation class, it's just what Ofsted are calling people on the scheme.
Did you actually speak with a status officer at HMRC? Was it due to the circumstances of your particular job - such as perhaps being ad-hoc, that made it possible to be Self Employed status?
Mind you, could be interesting if HMRC are accepting Home Childcarer on the Self Employment paperwork and not querying it. If that form gets through the system, then the person is choosing to be self-employed, and as long as HMRC never check up on it, there isn't an issue for anyone. HMRC are happy as they get paid, nanny is happy as they get paid, employer is happy as they don't pay Employers NI. Hmm... is HMRC happy losing that payment?
If you are choosing her days and hours then that makes you her employer.
I am a self employed nanny (amongst other things)but i choose who i work for and when.
a nanny CAN *NOT be se unless a temp/mn and even then you/they will need a letter from a status officer decaring that she can
if she is working for you and YOU choose the hours and days, ie mon - wed 8-6 then you are the employer and she is the employee!!!
a se nanny will decide whether they want to work that day or not - so unless you want your nanny to turn round and say, she isnt coming into work tomorrow, then she is employed by you
cherbear -I am also intrigued how/why you are se - if you work for a family on a regular basis
a few years ago,they were trying to make nannies to become a company and then they could save their employers tax, but it never came off - some legal loophole - do you remember that Nick?
I am a SE Maternity Nurse as each contract is different to the next be it :
place of work,
I have been since 2003 after 14yrs as a employed nanny.
I have spoken to HMRC bods in different offices at different times with queries and all have been happy with my status, none have offered or asked for a status letter.
I am listed on my SE return as a Maternity Nurse with no issues.
nope a SE Nanny as i was told is a non starter.
I was told you CAN BE if you care for families on an ad hoc basis like airline staff/temporary work staff like hospital bank staff with differing days/hours etc and have more than 1 family involved.
This was told to me 2 yrs ago, when i was enquiring about the differing perceptions of being a SE person in the childcare field.
Yes - a Maternity Nurse is nearly always SE - you are quite right about that and that as a nanny it is very difficult to be so.
matnan - you are se as thats beacuse you are a MN
thing is different people tell you different things at the tax office - hence why if a nanny asks and is told, it is better to have it in writing that they can be se, so if things ever came to a head, they have some proof
I personally cant think why anyone/ a nanny really wants to be se - yes you can claim back items on tax,but you also dont get paid for illness or holidays (hubby is se ) and it can truely be a bugger
I am a SE nanny. I work for 4 different families, working around my commitments. So I decide when I am available to work. The work is not at the same times each week. I also pick up temp work.
I have found this very easy. Holidays and sick pay would obviously be nice, but the pros outdo the cons for me.
I am a self employed nanny, and have been for over 3yrs, I am on the Voluntary Childcare Register, I have an accountant, i pay my own tax and NI, plus insurance and membership fee'e and all these poeple know I am self employed. Like Emily23 I'd like holiday and sick pay would be nice, but the pros certainly do outdo the con's for me.
I work regular hours for some famlies and at hoc for others,
It works well for me and the families I work, as they can not afford a full time nanny or even a perminate one, so this keeps everyone happy and me in regular work.
"By nannydd on Wed 13-Aug-08 07:32:38
I work regular hours for some famlies"
"By jura on Wed 13-Aug-08 08:33:15
If you work regular hours for some families then that element of your work should be as an employee, unless it's on a temporary basis, surely?"
my thought to Jura
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