Would you / do you pay your nanny in cash?

[wolfhound]

After a bit of a search, through a private advert, we've found what seems to be a really good part-time nanny (2 days a week).

The only thing is that she wants to be paid in cash and says this is how she has always worked.

Is this common? We paid our previous part-time nanny through BACS.

Would it cause problems in any way - for us or her? Perhaps invalidate public liability nanny insurance? I am a bit concerned.

I did not have set days some days I would work three or five days a week.

Wolfie - sounds like you need to educate yourself with regard to the legalities of employing a nanny.

Quite obviously, if your nanny wants to be paid in cash for two full days of work every week, then she is avoiding paying tax. Am amazed a person can be educated to phd level and not realise this.

bibbity - do you mean me, re: PhD? i don't have one - yet, anyway...

We are definitely not employing this nanny. She's adamant that she will only be paid this way (i.e. not through PAYE) - we're not willing to commit tax evasion, and as mollymole says, we want the person looking after our children to be honest & above board.

Wonder how common it is though - it seems both her previous employers (whose kids go to the school where ours will go) have done this. If I see her at the school gates with another child, I guess I will know the parents are doing this!

Unfortunately it can be quite common, but from both sides. I'm a nanny and i have had a few interviews where parents want to fiddle or avoid tax, thats why we are trying to get it where nanny pay is discussed as a gross wage like most jobs instead of net pay where people (on both sides) see this as room to fiddle-or not realise how much extra tax and NI can add up to.
good on you for wanting to do this above board though, it just isn't worth it. if she doesn't want to pay tax, maybe she's not even a legal?

We paid our nanny in cash for extra babysitting or out of hours emergencies (if we were suddenly late home from work by an hour unforeseen. Otherwise, keep it all above board.

Note that that is not OK either, overtime must go through PAYE. Babysitting is a bit of a grey area; if the nanny babysits for other people and puts the earnings through on a tax return then it is probably OK, otherwise probably not.

I know nannies who get paid cash. Most people that pay a cleaner pay in cash and nobody seems to bat an eyelid.

As for babysitting everyone I know me included do it for cash.

Cleaners are self-employed. You should be self-employed for babysitting as well really.

Yes you should be self employed if you are a cleaner but I do not know one that is.

I think you would only declare your babysitting if you were self employed. Most nannies are not self employed.

If you are babysitting though (for someone other than your employer) you should be paying tax on it on a self-employed basis. It's possible to be both employed and self-employed, just like it's possible to have two employed jobs.

I'm not giving advice here just experience.
When I had trouble with one family who among other contractual things hadn;t been paying all my tax, I went to solicitor. I had been babysitting regularly for them and solicitor looked up if they should have also been paying tax on that. He found a precedent that if you are working for a family permanantly but did very occaisional babysitting for them then non-declaration/payment of tax on the earnings was acceptable.

Additionally, my mums friend (also employed) tried to register with HMRC for occaisional cleaning-about £500/year and was told by them not to bother. Maybe it costs more to administrate such low amounts.

Like I say it's not formal advice but in practice very small amounts have been 'officially' allowed to slide.

Providing it goes through the books I see no reason why she shouldn't have her net paid in cash. I am usually paid weekly into my bank account but some employers have paid cash in the past but tax and insurance have always been paid.