Nanny two jobs tax code

[FlorenceMattell]

Hi
I have just got two separate part time jobs as a nanny, one two days and one one day. Two totally different jobs, one through an agency one a friends friend.
The second employer is asking me to split the tax code, as the did that with last nanny ? Why.
there doesn't seem any benefit to me or her in doing this.
I would pay more Ni if two jobs combined, also second employer would then be liable for NI where as as second job on BR tax code earnings under £144 PWP so no NI due. Also first employer would pay more NI
Have I overlooked something here?
Thank you mumsnetters

Have you agreed Gross salary in both jobs?

Yes I have .
To be honest families both new to nannying, second mum only had the one previous nanny and family one first time.

Have you given either your p45 yet? Have you completed a p46 for either job?

Which job pays the most and does the annual amount exceed personal tax allowance for 2013/14? PAYE calculator, select 2013/14 tax year to see the default taxcode

2nd employer using nanny agency?

Are either using a nanny payroll company?

This would be sensible if you had a net agreement, but as it is gross there is no issue I don't think? I was once the second employer and with a net agreement the cost to us was much higher than for the first employer as the tax code was not split, and they used all the personal allowance.

Hi
No contacts signed yet, no p45 given yet.
Job one pays most and exceeds the 8,000 tax code, is that what you mean.
Both families are using payroll companies. Different ones.
Yes Jossy I had worked out second family more tax, hence I have asked them to agree a gross amount.
Not sure why the payroll company had previously asked them to split tax code. Wondering now if they were sharing a nanny.

Yes that is what I mean but it's not 8,000... it's 9205 for 2013/14 Income Tax Rates.

If your salary in job1 is over that, then give the p45 to job1 and have that as the primary job. Job2 can then be at BR - complete a p46 indicating that it is not your only job.

No need to split tax code in my view and personally I would avoid doing so as it could complicate things. Tell job2 that you will NOT agree to split tax code and get them to talk to their payroll provider and to provide you with a p46 form. Their payroll provider can then deal with it from there.

I'm just a nanny, not an accountant but I really can not see how splitting the tax code would benefit you.

Thanks Nick that is what I thought. And I am reluctant to split the tax code.

NI has nothing to do with your tax code, and jobs with different employers are never combined for NI purposes; the Primary Threshold of £146pw applies to each job, and each week, separately.

With one exception, if you are on a gross salary splitting your tax code only moves cash around - if you reduce your tax code from 810L to 710L (i.e. by moving £1,000 of personal allowance) with Employer A, they will pay £3.80 a week less to you and the same amount more to HMRC. Correspondingly, Employer B would be issued with 100T and pay £3.80 a week more to you and the same amount less to HMRC. So apart from the fact that Employer A gets to hang on to £3.80 more for a few weeks (PAYE is handed over to HMRC quarterly in arrears) and Employer B's cash flow correspondingly loses out. But there is LOADS of room for cock-up with employers applying the tax codes at different times, problems with catching up if applied mid-year etc.

The exception is if neither job pays enough to use up all your personal allowance, then splitting the tax code will prevent you having to claim back a refund after the end of the year.

That is the wrong figure Nick, the personal allowance for 2013/14 is £9,440 - use this link. You linked to the pages from the earlier Budget announcement. And of course it is still £8,105 until 5th April.

Yes I would prefer to claim refund from tax office at end of year it wouldn't be much, rather than split code. Have made tax claims in past and found it easy to be honest.

Thank you for answers very helpful.

Out of interest, if someone had a job paying under £107 a week, thus their employer did not need to register as an employer, would that employer have to register if their employee took a second job? Would a p46 need to be completed for second job to indicate it was secondary employment?

Sorry for the wrong link, should read things better!

nannynick - I am not sure as I pay well under £107 a week for my part time nanny but I have gone with a payroll company to take all the headache out of it, we are currently trying to work out which job counts as second job (nannypaye seem to think my job, nanny not sure as she started working for mee 2 days before her other job....)

I also wonder what would happen if in the first job they were paid more than £107 but not much more, so no NI or income tax. If they then had a second job, would the first job get allocated a taxcode like BR and all earning becoming taxable?

It may not happen that often but there must be times when a nanny works 1 day week, then adds another job say 3 or 4 days. Are those situations when the taxcode split does make sense, or is the tax side of things all done on the second job?

"Out of interest, if someone had a job paying under £107 a week, thus their employer did not need to register as an employer, would that employer have to register if their employee took a second job?"

No, but they might have to register if HMRC tell them to.

"Would a p46 need to be completed for second job to indicate it was secondary employment?"

Secondary is a misleading word in this context. When taking on an employee that does not provide a P45 an employer is obliged to determine whether the employee is already receiving employment income or other income which is subject to the PAYE regulations (e.g. some pensions) in order to determine which tax code to apply. There is no longer any requirement to use form P46 for this, and nothing is submitted to HMRC (but if you put people on 810L without keeping a paper trail you had better get our chequebook out when HMRC do a PAYE inspection).

"I also wonder what would happen if in the first job they were paid more than £107 but not much more, so no NI or income tax. If they then had a second job, would the first job get allocated a taxcode like BR and all earning becoming taxable?"

Not automatically. If the taxpayer requests it HMRC may agree to do this (although they would probably allocate 0T rather than BR).

"It may not happen that often but there must be times when a nanny works 1 day week, then adds another job say 3 or 4 days. Are those situations when the taxcode split does make sense"

Yes.

Thank You MrAnchovy.