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Paid childcare

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

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Original poster

Nanny Employer - Pension

18 replies

meggleshs · 20/05/2015 14:34

Hiya - I'm a first-time nanny employer and things are going amazingly well with our new nanny.

I just got through an email from our payroll folks giving me a heads up on pension changes - as of august 2017.

Argh - my head is spinning and I know I can figure this all out, but wondered if anyone else is in the same boat?

OP posts:

Are your children’s vaccines up to date?

Set a reminder

skyeskyeskye · 20/05/2015 14:38

not a nanny employer, but an accountant. The letter is telling you to prepare for the fact that from that date, you will need to contribute to a pension scheme for your nanny if

a - she earns over £10000

b - she is under 60

Obviously this is ages away, but if you are likely to have to set up a scheme, you will need advice from your financial advisor if you have one, nearer that time. They will write to you again closer to the time.

I would suggest asking a FA now, how long it takes to set up a scheme, then bear that in mind for X number of months before the date that it is due to start.

skyeskyeskye · 20/05/2015 14:42

www.thepensionsregulator.gov.uk/

that website tells you all you need to know.

and where I said 60 above, I should have said under state pension age, not 60!! slip there back to when women retired at a much younger age than the men!

Koalafications · 20/05/2015 14:44

b - she is under 60

That's not true, it's if she is aged between 22 and State Pension Age.

Koalafications · 20/05/2015 14:45

x-post. But worth remembering that the lower age trigger is 22

Original poster

meggleshs · 20/05/2015 14:52

Thanks - yes, just had a good look round the pensions regulator website. very good step by step site...

As my nanny earns over a certain amount and is between 22 - State Pension Age, she's eligbable.

My payroll company, Nanny PAYE is offering to handle all of it for £60 / year. I would still need to comply with law, choose a provider (as they're not FCA regulated). Trying to figure out if that's good value or not.

OP posts:

Oly4 · 20/05/2015 15:28

I'm a new employer too and was just goi g to deal with this in 2017! I use NannyPaye too and will prob just get them to deal with it.

electionfatigue · 20/05/2015 20:16

Payefornannies are offering a similar service. It took me approximately half a nanosecond to decide to use it! Sounds like a lot of hassle otherwise. Pension will be part of the overall package so if she takes it then pay rises will be smaller as I can't afford both.

Callaird · 21/05/2015 00:01

Your nanny can opt out of the pension scheme. I have a private pension and have done since I was 24. My parents made me get one!

If it was something my employer couldn't afford, then I would opt out. If it made me more favourable for a new position, then I would opt out. I dont miss the £9 a week that I pay in.

Koalafications · 21/05/2015 06:57

Pension will be part of the overall package so if she takes it then pay rises will be smaller as I can't afford both.

It would be a breach of the legislation to say that to a Nanny, or to imply it though.

nannynick · 21/05/2015 08:47

What do the payroll companies do for their £60 or whatever they are going to charge?
NEST don't change employers and payroll companies should already include doing pension deductions in their payroll admin cost, so anyone know why they are charging an additional fee?

electionfatigue · 21/05/2015 10:45

It would be a breach of the legislation to say that to a Nanny, or to imply it though.

It would be a breach to encourage her to opt out.

To say - I'm planning on offering you a 2% pay rise in x months, just to let you know that you can have it as 2% in salary or 1% in salary and 1% in employer's pension contributions isn't a breach, I wouldn't have thought.

Koalafications · 21/05/2015 14:37

Yes, it is election. It's a breach of the anti-inducement legislation that came into effect in July 2012.

electionfatigue · 21/05/2015 14:50

that's interesting. have you got a link?

Koalafications · 21/05/2015 15:43

m.wsandb.co.uk/wsb/analysis/2185727/employers-prepare-ae-anti-inducement-laws

I've had a brief Google and found the above article, I'm at work but can get you some more concrete info later, if you need it.

Essentially, prior to July 2012 employers could offer an employee a pay rise or a pension contribution, however, the anti inducement legislation was brought in to stop this. An employer saying to an employee (worker) that they can have a pay rise or a pension contribution would be seen as inducement to not be in a pension scheme.

I work with Employers as Pensions Consultant so this is something that I deal with quite a lot.

electionfatigue · 21/05/2015 15:48

Thanks - that's really useful.

electionfatigue · 21/05/2015 15:49

when you have a minute, would you be able to copy and paste the article? It's behind a paywall.

nannynick · 21/05/2015 17:45

This one (pdf) is not behind a paywall and I suspect it is about the same thing... auto-enrolment inducements.

Snikolaides · 01/09/2015 22:04

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