Nanny offering to work for no tax

The reason nannies can't be self employed is because Gordon Brown wants your tax money. As much as I agree that this is outrageous, it is what it is. If you hire a person to come to your home to look after your kids on a regular basis I'm afraid that makes him/her your employee.

I don't know how old your kids are and therefore if this suggestion would be appropriate, but you could reduce the tax burden by hiring an au pair / childminder / nursery combination. Though if you have very young children this is not really a good idea and if you have several children it is probably not cheaper.

You could try putting such a clause in the contract, but if it is found that in fact for tax purposes she is employed rather than self-employed then I believe that this clause is not legally enforcable - the employer will still be liable to have made the necessary deductions.

It is possible for certain nanny positions to be self-employed but it is rare.

I have to say that there are a number of nannies and parents who operate on a less than legal basis. You are obviously risking both fines and having to declare an offence if you go down this route, but you wouldn't be alone. Obviously a lack of NI payments gives the nanny an ongoing problem re benefits/pension, so you need to consider that if you go down the illegal route that this is something that could still come back on you many years from now.

As far as I know a nanny can be self employed it has to state in her contract that she will pay her own Tax and NI. There was a tax loophole a few years ago which made it very beneficial for a nanny to be self employed but this loophole has now been shut. If a nanny is requesting to be paid without tax I would be very dubious of her. I have been a nanny for 12 yrs and always paid tax. I know it is a cheaper childcare option. Have you thought about nanny sharing?

There's a lot of info on the nannyjob talk boards about this.
I seem to remember that the IR criteria for self-employed include - being able to choose your own hours, and being able to sub-contract the job to someone else...nannies can't do either of these things.
If you search for nannynick's posts on this subject he has a link to a copy of a letter from the IR which states that nannies cannot be self-employed. Maternity nurses (very short-term contracts I guess) can be though!?!

I don't think a nanny would qualify as self-employed unless he/she worked for more than one client at a time.

As for not being independant I assumed it was because the wages are fairly low in comparision to other contractor type jobs and having all the hassle of paying another 11% tax on earnings (emprs NI) and doing all your own PAYE etc would put most people off!

I have always thought it odd though that nannys wages are advertised net. Are there other occupations that do this?

its illegal for a nanny to be self employed... probably because it gets empolyers of of paying employers NI contributions. which again is a legal part of having a nanny!

i think the reason is ebcause the parenst are the nannys boss... we do what our bosses tell us... we dont waltz ina dn say we are looking after you children and we will do it this way.... we meet your requests, equaly we cant go home when we want, we have to wait for a responsible adult to be home whoch is sort of out of our control!

Agree with the others - It's not something she can choose! And it's not her who will end up fined by the IR

if found out you will be fined £3000... + all tax from the £ you have paid her

U are the one in the wrong, not her. shes unproffesional though, and i dont know ANY nannieswho would do it!