nannyshare employment type

[Oligo]

Hi all,

Friday night puzzle:
Just when you think you were beginning to understand things...
Does anyone know how employment status works for concurrent nannyshare employers?

It is one employment and there is one contract with nanny? (families agree other things e.g. coordinating holidays, between themselves).

Must joint employers (one lot of employer's NI) pay nanny out of one account?

Whose employer's NI number is required- both or just one?

thank you!

Employment status is based on what the person does overall in all their work during say a month. So if this nannyshare is happening for set hours, 5 days a week, then it's of Employed Status.

Must joint employers (one lot of employer's NI) pay nanny out of one account?

I wouldn't have thought so. May help to keep finances straight. Assuming there is one payslip, then document on the payslip the amount of money being paid from each account.

Not sure how paying HMRC would work... think anyone can pay as long as the Employer PAYE Reference is used. MrAnchovy may know.

Whose employer's NI number is required- both or just one?

Not sure... would you not be registering with HMRC as a new employer (in terms of being joint employers)?

Sorry, when I said status I meant for my employers (I'm nanny)- not sure if status is right word.

I mean if they are joint employers, who pays employer's NI contributions? the payroll people asked for employer's NI details so I assumed they were relevant for this. That is what has confused me.

Accountant seemed to interpret two NI numbers and being paid from two accounts as separate employers. How do two people become joint employers (i.e. offering single employment)?

Why are you getting involved with payroll company and an accountant (if the accountant is your's, are they not able to help explain things)?

As the nanny you are the employee of the parents, so you are getting a payslip from them, aren't you? That payslip will show deductions relevant to you.

Joint employers would have one PAYE Reference Number as far as I know, as only one family registers with HMRC. Least that's how I think it works.

It's beyond me I'm afraid. You need MrA. Are you using the right wording for things, such as Employers NI number (I didn't think they had one, thought they had PAYE Reference Number... I could be wrong though).

Parents don't really understand things. I've been involved with employment aspects in nearly every family I've worked for as they are always new to being an employer and I always seem to know more than them (believe it or not!).

The payroll accountant is not used to nannyshares but is being used due to being the one everyone has chosen (they use them for other things). They assumed two employers for the share and I'm trying to explain how that's not the case. It just seems odd that only one person registers with HMRC as the employer when there are two of them.

When I said employers NI numbers I meant like everyone has an NI number. They were asked for them and (I think) how they were planning to pay me.

And on the whole I'm not at all sure I'm using the right words!

Thank you though!!! and I'll hope Mr A or other knowledgable poster (perhaps a nannyshare employer?) sees this.

Maybe the best advice you can give them is to use a specialist nanny payroll company who is used to organising things for parents in a nannyshare.

I'm tired, it's been a long week (half term, plus my shifts have changed so my bodyclock has not adjusted yet) so I'm probably being of no help, especially as I am evening beginning to confuse myself.

If both employers have registered with HMRC, then there isn't a problem in doing it as two separate PAYE schemes is there? Think there is even an Employers NI saving doing it that way.

You are helping! and thanks for time spent on this after your long week.

I did actually suggest the payroll company you had linked to previously payefornannies ?i think? but it's complicated (partly due to my other job using same long term accountant) and the accountant is willing to get up to speed but just need to explain things a bit.

If they register separately then it is like I have two jobs happening simultaneously and for e.g. they could dicate different holidays and I might not get the right time off. Plus I have one contract mentioning all of us; it wouldn't work if one family left the share. Thinking about it married parents are both employers but they don't both need to register separately but maybe that's due to being married.

Having them as separate employer's seems to mean another lot of employer's NI and another lot of calculations (paying another payroll fee), whereas if single employment it should just be one lot.

don't feel you need to reply to this; i'm just working things out as i write and do really appreciate your input.

Two separate employments is better for NI, but if you have one contract the fact is that there is one employment.

Your employers should in theory jointly register for PAYE, although if one of them already has a registration there is no practical reason not to use that.

The reason the accountant running the payroll needs the employers' NI numbers is so that he can register them for PAYE. He is not allowed to do this through you or run a payroll for them without direct contact, proof of identity etc. under money laundering regulations so I am afraid that I can't really help any more :(

Two separate employments is better for NI, but if you have one contract the fact is that there is one employment.

Your employers should in theory jointly register for PAYE, although if one of them already has a registration there is no practical reason not to use that.

The reason the accountant running the payroll needs the employers' NI numbers is so that he can register them for PAYE. He is not allowed to do this through you or run a payroll for them without direct contact, proof of identity etc. under money laundering regulations so I am afraid that I can't really help any more :(

Think you may be confusing taxation and employment law. They are separate. So your holiday situation is dependent on your contract, not on who pays you.

I don't see there being a problem with you having one contract and two payslips. As long as it all ties together, thus the contract mentions both people, then at a future date it can be shown that you were working for them jointly.

ok, thank you both.

Out of interest why are two employments better for employers' NI if it means they will both have to pay it?

I assmumed two payslips would mean two lots of payroll costs for the year, which they were not planning for since they chose a share partly to share costs.

So at the moment I am working with it being one contract one employment. Both families in the share are new employers so will explain they should probably register jointly.

I think it is because there is no employers NI to be paid on earnings at or below the Lower Earnings Limit.
See: PAYE Rates & Thresholds for Employers

I assmumed two payslips would mean two lots of payroll costs for the year, which they were not planning for since they chose a share partly to share costs.

But if the same accountant is doing the work for them, they may not be charged that much extra. If they each used a nanny payroll company then I suspect they would be charged double but in the big scheme of things, £125 a year (or whatever the price, given that different services charge different amounts) is small in comparison to the savings made by sharing the cost of the nannies salary.

You have already advises them to use a nanny payroll company, which they have ignored. I would leave them to it, if they want to use the services of an accountant who they already know, then let them do that. It's not something you should be getting involved with... their accountant can look into all the tax legislation and decide what is most cost effective for their clients.

I know you are trying to help them but I feel you may confuse matters.

I expect you have already told them this but if you haven't, do make sure you are paid a Gross salary - as having a Net pay agreement will just complicate matters further!

Is your other job your main job? So for both of these employers (the nannyshare) you are completing a P46 to say it's not your main job? If so, then your main job would I suspect use all your personal tax allowance, so both the nannyshare employers would be using BR taxcode.

Keep an eye on the taxcodes appearing on payslips and contact your tax office if you find that all employers are using the same coding. Then the tax office can look at it and issue coding notices if necessary.

Hi, hoped I could update with a resolution here today but...

Mr A (I love anchovies)-if you're there? How sure are you of them being able to register jointly? Accountant insists they need to operate separate payrolls/as separate employers despite one contract. So probably more money for payroll. Is there an official link about it? Or about one contract = one payroll employment, by any chance?

NN- thanks for table (endlessly facinating)- looks like they would both be over limit and would need to pay employers NI and it would be my main job (if it was one job).

The accountant is new for these families (it's from my other job) and I introduced them as I suppose ultimately we both thought/agreed it would be easier to have everything in one place and hopefully less hassle! So I feel a bit responsible.

So many times families just don't know about being new employers and I've been a new employee so many times when they ask where to start I feel it would be rude not to help them out a bit and indicate options and norms- and I can't just abandon it all now when it's more complicated than ever.

Oligo.....I am a nanny in a full time nanny share.

As instructed by NANNYPAYE (whom both families use and I would HIGHLY recommend having a chat to),I have 2 contracts - one for each family. Details and content are EXACTLY the same apart from the hours worked. For one family, I am down as working 8 am till 1 pm Mon-Fri. For the other family, it is 1pm till 6pm Mon-Fri (even though I have both boys 8 till 6. This all come down to a very complicated minimum wage hoo haa that I can't quite explain here without an enormous ramble)

They have split my salary right down the middle. That way, they are EACH responsible for their own tax returns and NI contributions.

Both families use the vouchers, so it's just been a case of getting those payments made at the same time as the 'bulk' of my salary which comes from the parents personal accounts (am I making any sense here??)

So to break it down.

FAMILY A - contract says 8am till 1pm

'voucher' money paid into my account at the end of the month along with the remainder of their half.

FAMILY B - contract says 1pm till 6pm

'voucher' money paid into my account in the middle of the month along with the remainder of their half.

I REALLY hope that this has made sense! I am not the best at explaining things

It may appear complicated but I can assure you that it is not - if I can understand it then anyone can

Hope to have helped rather than hindered!

I think you raise another issue, that of NMW in the event of there being two contracts.

Nannyshares are not simple. If an accountant can't sort it out then you need to get another accountant, one who has done this sort of thing before.

thanks guys for taking the time. It's become my little mission to figure this out.

Today, payroll agencies, bar one that did sound quite clued up and honest re. both set ups, have been generally recommending it be two and wouldn't really discuss the practicalities of it being one but I guess that's two lots of fees for them.

Imo if there is so much confusion around this issue then claiming one employment when the law/hmrc might consider it two employments is safer fraud than claiming two (with two lots of benefits e.g. sick pay, and less NI contributions) when the law/hmrc might consider it one.

Mind you the split hours thing wouldn't protect you in disputes and similarly might be fraud, although to me it sounds a rather sensible way round.

Yes! NMW would not be possible for many shares- surely sharing might sometimes be so the parents can afford nmw! Thankfully that's not issue in this case cos I'm in London.

Our contract would need to be revised via agency- wonder if they'd charge more for that...

Yes I am here, but I'm afraid if there is already an accountant giving professional advice there is not a lot I can say. I have already mentioned that I have concerns over that arrangement :(

As has already been mentioned it is more tax efficient if there are two employments, and in order for there to be two employments there must be two contracts (I suppose you could draw up a single agreement with 'Employer A' and 'Employer B' which created two separate employments but it would have to be specially drafted and there would be no point).

Why do you insist on coming to the conclusion that you are being told this by payroll agents so that they can get an extra fee? Has it occurred to you that they may be giving good professional advice? In 2011/12 the annual savings for a nanny earning more than a total of £278 per week in two employments are £867 for the nanny and £975 for the employer - a total of over £1,800. So stop being so paraniod and listen to the advice.

If you really want to go the single employment route and pay more National Insurance, there is some information about this situation here although this is not a recommendation of that agency or the advice given there.

I think you should stop trying to figure this out yourself and hand it over to the experts. Sorry if I sound a bit bossy, I don't think I do normally, but you don't seem to be listening to subtle hints.

Oglio, the split hours isn't fraud!

It has to be seen as having 2 separate employers otherwise it comes across as you being paid below minimum wage.

To try and explain, with each employer 'employing' me for each half of the day, my net wage, for each employer is £10 per hour.

If it was ONE contract, it would still have to be 2 invoices for the separate families, but these would state that I am on £5 per hour, which is below minimum wage for someone my age.

It is because of this that there has to be 2 contracts, exactly the same, just with different working hours.

I know I haven't explained this very well - if anyone understands what I mean and can explain it better then please do!!

I have worked this way for a long time and have NEVER had any problems with it. It is all legal and above board.

Speak to the people at NANNY PAYE - they can explain things better than me - they are very helpful and kind!

Sorry, just to add.......I get payslips from EACH family showing my salary and their NI and tax contributions.

Oh apologies I understand about min. wage thing. So one employer pays you to look after both families' children and then the other does. How confusing!!! and elegant.

That's pretty much it yes. It's actually not complicated at all - it's just me making it so by being a doofus not explaining very well

BOTH families are registered with NANNY PAYE and both have me as their employee. My payslips are identical as are my contracts, apart from the working hours.

Hope you get it sorted - once it's all explained properly and you understand, you'll wonder what all the stressing was for - I was the same when I first went into nanny shares

mranchovy- Those agencies (didn't speak to payefornannies that I mentioned before btw)
giving 'two employment' advice effectively refused to discuss the option of joint employers. The main repeated reason was that if one employer pulled out they would have to close the registration and reopen it with one employer; or another that there would be 'problems' with the 'Inland Revenue'.

I explained I would no longer be employed if one pulled out and asked what specific problems but they just went back to 'our advice is...' like a call centre worker. This might be professional but it is not reassuring. The one agency that openly discussed all options and actively asked questions about my circucumstances before I explained them said it would only be possible to have joint employers with them.

I don't think they are just in it for the money but they are a business (NI savings don't go to them). Surely it is acceptable for clients (and their dependents) to ensure they are being sold the appropriate thing and have any specific concerns addressed specifically. If the experts could do this and agree! then no problem, they can have the job- and get paid too. If clients are not asked and do not know to say 'we have one contract' then maybe they are liable for any future problems.

I just don't want to be in a situation where I or my employers am doing something illegal re. contract just because accountant is not familiar with nannyshares. Better sort it out now than later. I didn't know where else to go.

Even though you don't seem very happy about it MN has given me more information than anyone else (and you the only one to say one contract = one employment) and I really value that. Oh sorry just understood you had concerns commenting cos of accountant.

What's wrong with wanting to be more informed about how I am paid and taxed? Better sort it out now than later. I get that it's boring for everyone but I've got some help and that is what I was hoping for.

no MissyMooBag78, you explained it fine, its me not understanding