Are your children’s vaccines up to date?

Set a reminder

Please or to access all these features

Paid childcare

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

Self enployed nannies

31 replies

wizzywig · 17/05/2015 18:25

hi all. i will be employing a nanny for 10hrs a week. She is working around 20 hours for another family. i thought i would still have to set up payroll as a PAYE employee but hmrc says nanny's who work for 2 families can be self employed. is that right? www.gov.uk/au-pairs-employment-law/nannies

OP posts:
Are your children’s vaccines up to date?
nannynick · 17/05/2015 19:50

I would not trust that information. The Employment Status manual is huge and any one factor alone does not determine employment status. So how Gov.uk can say that is beyond me.

Are you deciding how much to pay?
Are you deciding when they do the work?
Are they able to say no to coming into work, such as offering a different day instead (which is what a cleaner would do)?

I would view them as an employee if the hours are set and regular.
If it is more like ad-hoc babysitting then that would I feel be different.

Whilst HMRC might allow a nanny to be self employed, does the nanny want to be self employed? Do they want to run their own business, not have entitlement to paid holiday or other statutory rights? Do they want to be doing accounts and a tax return?

Do you want to stop another person (probably a young women) from having employment rights - things that women especially have campaigned for years to get?

At 10 hours a week there is unlikely to be any Employers NI. So costs you need to consider are things like:
Payroll Admin (£140 a year, or do it yourself)
1% employers pension contribution (might not be until 2017/18)
Statutory Sick Pay (don't think this can be claimed back as it could in the past).

Yes it is a pain being an employer but it gives the worker more rights and you have more control over what they do, when they do it.

Hard to tell someone who is their own boss what they should be doing!

nannynick · 17/05/2015 20:02

Useful read is the ESM500 parts of the Status Manual.

www.hmrc.gov.uk/manuals/esmmanual/ESM0500.htm

nannynick · 17/05/2015 20:03

At the moment there is no definitive answer but the Gov.uk site does clearly state that you (as the potential employer) can not ask them to become self employed. So it has to be entirely up to the nanny.

PenguinsandtheTantrumofDoom · 17/05/2015 20:09

I can't do the non - clicky link on my phone, but Gov.uk is often inaccurate these days. It gives the impression it is run on a shoe string by interns.

As an ex employment lawyer I would be very dubious they could be self employed.

PenguinsandtheTantrumofDoom · 17/05/2015 20:10

Sorry, posted too soon.

.... in your scenario.

Karoleann · 17/05/2015 20:11

That's quite interesting and new! I noticed they've updated the au pair section too.

Great, much easier for you. Its very easy to register as self employed and generally she pays a bit less tax too.

nannynick · 17/05/2015 20:15

They have not added anything to the ESM though, I can not find it in ESM4000 www.hmrc.gov.uk/manuals/esmmanual/ESM4000.htm

If a single factor is being used to determine status, would you not expect it to be listed in the Particular Occupations section, as it is for things like Examiners?

wizzywig · 17/05/2015 20:16

just to add the only reason id like her to be self employed is purely so i dont need to set up payroll and think about tax and NI. Yes she will advise us when she can & cant work ( i dont work but her other family do so im fitting in around her other committments).

OP posts:
nannynick · 17/05/2015 20:20

I do agree that it does make it easier for when a short number of hours is involved.

However I do feel it is eroding employment rights. Tax law and Employment law are different things so even if Tax law did decide that they were not an employee then Employment law might, or might not consider them an employee.

nannynick · 17/05/2015 20:23

The fitting around her commitments does tend to imply that she could be self employed, as she is in control of when she works. Though it is just one factor. If she has many clients, that could also be a factor taken into consideration (as is likely the situation with a babysitter).

If anyone wants some light bedtime reading... then the OTS has published a report recently (March 2015) about how Employment Status might be simplified. www.gov.uk/government/uploads/system/uploads/attachment_data/file/422248/OTS_Employment_Status_report.pdf

YonicScrewdriver · 17/05/2015 20:25

Once she has advised you when she can work, will it change frequently? Otherwise she's just saying she's available for work on Tue and Thu and you are employing her on those days.

PenguinsandtheTantrumofDoom · 17/05/2015 20:39

Does she have to provide 10 hours at some point each week?

PenguinsandtheTantrumofDoom · 17/05/2015 20:42

Just to reiterate. Do not rely on something you find only in one place on Gov.uk. I have seen too many mistakes to count. Most recently they updated the section on the law on car seats and it was gobbledegook. MNers emailed them (and we went through two iterations)before it was accurate. Even when technically accurate it is often grossly over simplified.

nannynick · 17/05/2015 20:49

Has she actually told you that she is self employed?

wizzywig · 18/05/2015 09:29

hi penguin. yes she'll work 10hrs a week on days of her choice. nanny, she is starting out as a nanny and hasnt said anything about being self employed

OP posts:
wizzywig · 18/05/2015 09:30

whenever i rung hmrc to speak to someone i get a message saying they are busy and the line disconnects

OP posts:
wizzywig · 18/05/2015 10:09

just spoke to someone at hmrc and they said if your nanny chooses to be selfemployed then she can do. i then pay her gross wages into her account.

OP posts:
YonicScrewdriver · 18/05/2015 10:23

That's it? That's all they said? No conditions I. That?

That's crap advice.

PenguinsandtheTantrumofDoom · 18/05/2015 10:28

I'm sorry Wizzy, but if that is literally what they said (without any conditions or exceptions) then they have given you very bad, wrong advice.

PenguinsandtheTantrumofDoom · 18/05/2015 10:29

But if that is what they are going to say, ask them to put it in writing so that you have some evidence if they pursue you for tax later. I bet they won't.

YonicScrewdriver · 18/05/2015 11:30

YY Penguins

iK8 · 18/05/2015 11:46

There's a difference between employment status for tax and employment status under employment laws.

There are several tests of employee status including the right of substitution (ie could your nanny send someone else to do the job instead of her that you had never met?), control (or who decides when, where and what the worker will do?).

A nanny share for two families is extremely unlikely to be a non-employee relationship and that page linked to in the op is worryingly inaccurate. I've just flagged it for review by the publishers.

PenguinsandtheTantrumofDoom · 18/05/2015 12:27

I've just seen the actual page. Yes, that is appalling advice. I hope anyone who has relied on it has saved a screenshot.

Back in the mists of time, government departments used to maintain their own web pages. The DTI had a detailed site on employment (became DBERR later on). When it all got simplified down to gov.uk they removed a lot of the detail and it became very inaccurate. I swear I suspect that they use interns and other juniors to generate the content to save money. The old DTI site was one even practitioners would sometimes use to refer trainees, etc to a decent summary of the basics. You'd never in a million years do that with gov.uk.

It's often a bit like when you read articles journalists write on tax and employment law. They take the detailed, nuanced position and they try and edit it down. Except, because they don't have the depth of understanding they often change (subtly or drastically) the meaning of what they say.

YonicScrewdriver · 18/05/2015 12:44

it is bad advice but because it uses the word 'can' i suspect it won't stand up as a defence

YonicScrewdriver · 18/05/2015 12:45

using 'can, in certain circumstances' wouldve been much better