Contract and payroll for a nanny share

[Gingerbreadgirl1]

Hello,

We are two families who are about to hire a nanny for 4 days a week minding 2 children for about 90% to 100% of the time. We haven't worked out yet exactly how many hours we will each need as this will depend on the commute.

Originally I thought that we could draw 3 contracts one between family A and nanny, one between family B and nanny and one between family A and B. The idea would have been to evenly split the costs between the two families and making both responsible for the nanny rather than one family bearing the risk in case the share breaks.

However from what I gathered on the internet, it looks like HRMC is likely to consider this nanny share as one employment only which means that one family is responsible for the payroll (taxes and NI contribution) and the other one will transfer half of the money at the beginning of each month. Is there a way we can get the two families to directly participate to the payroll?

I know we can mitigate the risks by adding clauses to the contracts but I would rather see if we can have a more balanced way of doing things. I personally would like to handle everything (contract and payroll) for my family myself but if it's too complicated I think I'll need to go with a payroll company.

Any advise would be much appreciated.

thanks!

I would contact a payroll company that is used to doing nannyshares like this, as they will have set things up for other parents in the same situation.
See if they will provide you with information for free without you having to use their service.

You may want to consider using them for the first year, then taking on the payroll role yourself after that.

As the vast majority of the time is shared care, then I would have thought it would be one PAYE scheme where you and the other parents are jointly named as the employers, so you have joint liability.

Employment law wise, you would then have one contract between both families and the nanny. You would have an agreement between you and the other family which would deal with things like joint responsibility for Employers NI and other costs, how to end the agreement, what if one of you goes on holiday but the other family still needs childcare.

Thanks Nannynick for your advise. I will contact some payroll companies and see what they come up with.