How to work out actual cost of employing a nanny

[bodgerthebadger]

Hi, we're debating whether to switch from private nursery care to using a nanny as we now have no.2 and the costs may be comparative (only a nanny will give us greater flexibility for work).

We know that we need to tot up hourly rate, NI, tax, food, nanny tax & payroll services, activities, extra heating used etc. I can work out most of these but I'm struggling with the NI and tax.

Does anyone have any useful links that would help me understand and then calculate what NI and tax we would need to pay assuming an X hourly rate?

Thank you very much!

x

Www.mranchovy.com/calc will calculate Gross salary, Employers NI and other payroll things.

It will also do Net to Gross, though you must know the right taxcode to use. 1000L is ok if it is the person's only job and there are no special circumstances. Use only as a guide, agree a Gross salary.

What is your estimate for activities cost? I feel that is hard to calculate, so interested to know how you go about working out a reasonable figure.

Thanks Cindy34 I will check out that link.

The estimate would only be relevant to the area that I live in so I don't think inserting a figure here will make much sense. In terms of how I work it out, my estimate is based on the cost of baby/toddler classes where I live as well as the soft play and Sure Start centres. I wouldn't the nanny to be taking them to classes everyday as it's super expensive where I am (b/w £8 - £11 each class) but, if she wanted company, then there are plenty of subsidised/locally run play groups where I am that only cost b/w £2 - £3.75 per session.

The toddler will be at nursery a couple of days a week using the Govt subsidy so there would be no extra cost there for toddler's activities on those days.

We also have a couple of excellent parks very close to our house with great playgrounds (free) where I usually go most days. Swimming classes are £4 for baby/toddler.

In addition, whilst I've factored in some extra cash for the kitty to pay for stuff like arts and crafts materials we usually have that stuff in the house anyway so I'm not expecting to add too much for this. I see that as an existing cost really as it's what I pay for now on top of nursery fees.

Hope that makes sense!

Going through exactly same process... So watching!

If you offer a gross wage then you don't have to try to work out what the employee pays in tax/NI/student loan etc.

We started off leaving 30 per week for activities, but it has changed over the years - now it's a lot for school holidays but pretty minimal in term time now DS is in pre- school.

TheScience I'm also trying to work out what the employer would need to pay in NI but the link shared by Cindy34 has shown me that. Definitely, it seems that the cost of a nanny is going to be much cheaper than 2 x private nursery fees. Incredibly really!

incredible

It certainly can be cheaper in areas where nursery fees are high. You are doing the right thing in working out the likely costs.

Activities cost does change over time and also on time of year. It is not just that there are more trips to playgrounds when it is sunny but also that groups may only run in term time and not school holidays. You may want to get your local area school holiday dates from your local authority website so you know roughly when some things may not be running.

Swimming class sounds very low cost. In my area they are very costly. Cheaper for me to take the children swimming when little.

Have you looked at what to do about nannies holiday? You will need to take time off yourself or get alterative care. Some nannies may agree to go on holiday at the same time as you do but it is often a 50/50 choice.