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Paid childcare

Discuss everything related to paid childcare here, including childminders, nannies, nurseries and au pairs.

Self employment, please help!

10 replies

PurplePidjin · 11/12/2013 18:59

A friend has asked me to look after her 11mo for a couple of mornings a week - I'm a sahm to my own 1yo, as well as level 3 qualified in childcare, current DBS/1st aid etc due to pt employment. I'm also about to start up a weekly baby group which will bring in an income.

Obviously i need to keep a record of all outgoings and incomings, but do i need to inform hmrc immediately or just in April? Do i just pile straight in with a self-assessment form thingimajiggy?

It makes most sense to me to sort all the tax as i will be doing it for the group anyway. I'm the "emergency nanny" for a different friend with a long commute too so can include any income from that and save her a job (we were going to go through nannytax or somesuch)

Is £5ph about right? I'll collect the other dc then take them both to play group, provide snacks and drop her home (rural area, car essential although i do normally make the effort and walk, it's a couple of miles) hopefully having napped mine does, hers is more erratic but we can try

Thank you Thanks

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DeepThought · 11/12/2013 19:35

What you are describing seems to be a standard nanny and as such you probably won't be able to operate as a self employed one. Nannynick or MrA will be able to advise more fully. There are certain criteria to be satisfied.

Alternatively you could work out of your own home but must register as a childminder.

Have a look at the tax office website under self employed nanny in the meantime.

Ps am assuming more than two hours per week and in England

nannynick · 11/12/2013 20:18

Caring for the 11 month old will need to happen at that child's home. This gets you around the childminder regulations in childcare law.

Run it past HMRC Status Team.
Before contacting them make sure you know:

If the days you will be caring for the child are the same each week, or will vary.
If you have any obligation to provide the care - can you turn down requests?
How many other clients you have for whom you do the same/similar thing.
How many other clients you anticipate having once the business picks up.

It makes most sense to me to sort all the tax as i will be doing it for the group anyway.

It is not as simple as that. If it is a job, as a nanny you are most likely to be an employee. It's a matter of what the facts indicate, such as amount of control the parent has over you. There are numerous factors which HMRC will take into account, so talk to the status team.

I'm the "emergency nanny" for a different friend with a long commute
That is very ad-hoc work, so more likely to be self employment, though may depend how long each assignment lasts.

Is £5ph about right? I'll collect the other dc then take them both to play group, provide snacks and drop her home (rural area, car essential although i do normally make the effort and walk, it's a couple of miles)

Sounds low even for a NWOC (nanny with own child). You need to consider how much you would be spending out on advertising (you need to make it look like a business if HMRC are to agree it is a business, not employment), class 2 national insurance, class 4 national insurance (if profits £7755 or higher), income tax (if your total income from all sources totals over the personal allowance), liability insurance, equipment, business use motor insurance / specialist motor insurance for nannies.

You MUST NOT go to your home. If playgroup was not on, you must go somewhere else, or back to the child's home. Do not confuse things by going to your house, as that can then become childminding with requires registration. Sure there are time rules within legislation but I would avoid the issue completely by providing the service from the child's own home.

we were going to go through nannytax or somesuch
You can contact nanny payroll services for advice. Perhaps have a chat to them with regard to emergency nannying and if caring for this 11 month old would fit with being emergency/temp, or not.

Toddler group wise, look into insurance requirements. Pre-school Learning Alliance has information about starting a toddler group, plus can provide an insurance quote. Insurance for toddler group is also available from Morton Michel.

Consider your costs: advertising, rent, heating/lighting (if not included in rent), equipment, snacks. Keep records of all expenditure and income.

This pdf looks useful. It is for groups in Scotland but much will apply elsewhere.

PurplePidjin · 11/12/2013 20:23

I can't register as a cm, i live in a flat with stairs directly to a main road - doubt that counts as suitable premises Sad

3 hours x 2 days a week, yes in England

Thank you Thanks

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PurplePidjin · 11/12/2013 20:26

Wow, nannynick epic post thank you! I would only have one other baby at a time, though, one is tough enough and i don't have twin experience! I'll check those links out asap Thanks

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nannynick · 11/12/2013 20:52

Income wise you are looking at £60 a week or less.
So no employers NI on that if it is to be done as employment.
No employee NI either. There may be income tax, depending on what you earn in your other job.

Is your other part time work paying £10,000 a year or more?

I feel the parents of the baby should call a nanny payroll company and chat about it. Have a good idea of salary first... such as £6.50 an hour upwards (so it exceeds National Minimum Wage). Explain to them the short number of hours, thus pay per week will be under the Lower Earnings Limit for National Insurance. However, the person has another job, so does that mean they must register as an employer and submit returns even if all income for the person is under personal tax allowance?

The payroll companies are used to queries like this and know from experience what HMRC will expect to happen.

It may be a case that a PAYE scheme has to be setup, as you have another job, and there is a possibility that in the future you may be paid enough to pay national insurance - if say one week they needed a lot more hours of care.

Very hard to know for sure about these things. You, and the parents concerned, need to seek professional advice, such as from accountants who do nanny payroll on a day to day basis.

PurplePidjin · 11/12/2013 21:10

It's all very complicated, i thought i was doing a favour for a mate and earning a bit of cash! (10k a year would be amazing, I'm nowhere near that) Xmas Smile

I'll send her the link to this thread, easier than trying to explain Xmas Hmm

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nannynick · 11/12/2013 21:21

Could you avoid the issues and remove the money? Perhaps she could care for your child occasionally in exchange?

PurplePidjin · 11/12/2013 22:03

Could do but half the reason she's asked is that we're skint as a skint thing from Skintness, Brassicshire and £30 a week would be a huge help (6 redundancies, a baby and dp having a stroke all in the space of two years have kind of buggered things up!)

She could pay me in Tesco vouchers?

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Blondeshavemorefun · 11/12/2013 23:25

PP - wow is bubs a year and sorry to hear about dp stroke :(

What you are describing is a nanny role and not a se one / so the lady would need to register as an employer but won't e paying tax or ni as not enough hours

You would be better off trying to find a nanny job with more hours and take bubs with you so prob earning less than a nanny without a child - but more then £5 / that's not even nmw

What is the group you are planning to do?

PurplePidjin · 12/12/2013 08:29

I'm worth about £8ph round here, and I'm registered with both major local agencies neither of which have come up with anything suitable - one took 3 months to reply to my email enquiry about a job, by which time my circumstances had changed and the hours weren't suitable Xmas Hmm

The group is baby singing Xmas Smile

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