Self employed nanny?

[Primaryteach87]

I'm thinking of starting a part time masters. We have two children (2 and 6months). Currently our firstborn goes to nursery very part time as a break for me! I'm super happy with it there but we will be moving. So not an option in the future.

I'm thinking about whether a nanny would be a good option but would only need one day a week. Is it possible for a nanny to be self employed? I have worked in HR in the past and worry about the hassle/complexity of paying nannies. There seems to be the expectation to pay gross but that is impossible if they are working for lots of different (potentially changing) families. I'm confused! I'm not sure what the going rate is ...we would be in South London at this point.

Any advice welcome.

One fixed day per week, at hours you decide would be employment. You want someone to turn up when you need them and you want to be able to tell them what to do.

Agreeing a gross salary is prefect, as you know what it will cost you. Perhaps you meant Net pay, in that situation you are writing a blank cheque!

An evening babysitter who you may hire on random occasions is self employed. A nanny who comes the same day each week really should be your employee. Yes you will have HR duties but you are unlikely to have employers National Insurance (unless you pay them a lot) as they will probably earn under the amount for that. You will need to deduct their income tax from their wage, unless they had no other work and you paid less than £112 a week.

Sorry sleep deprived, yes meant net not gross!!

Any idea how much it would cost (or a range) for one day gross with any on-costs. I'm really clueless about what is the going rate.

Depends where you are, experience required. Just seen a job advertised at £17 gross per hour in London. So £170+ gross per day. That is probably the high end. Low end would be more like £80+.
You then have activity/outing costs, mileage/travel on duty cost, food/drink.
You will then have employers NI possibly and payroll admin is around £200 a year.

Employers NI on £170 gross per week is a little under £2 per week.

Okay. Sounds way more than I was hoping. Childminder it is!

Incidentally, why is the hourly rate so much higher than for a nursery member of staff? £10/hour would be a very good rate in a nursery round this way. My son's nursery whose staff are wonderful pays £7.80 ...

Sorry that sounds like I don't value nanny's work. I do but as a teacher I don't earn much over £20/h. So seems very high. I don't need someone to be everything/substitute parent. Just someone who will care lovingly for them for 8 hours a week in my absence.

20 mins outside of London, you can get a nanny for £10/hour net - but you should calculate what that is Gross, and write the contract that way.

I had a nanny 2.5 days (9/hour net as it was her first nannying job and she brought her own child). It cost me 250/year for my accountant to run her payroll, and I seem to remember about 80quid/month in Employers NI, then another 100 in mileage (no school run, just out and about)

I stopped, and sent my child to a childminder when all the pensions stuff came in because I decided it was more hassle than it was worth (and we had a lovely childminder) - saved me 10k a year when I switched.

Is it possible for a nanny to be self employed?
Yes technically but it's a difficult criteria to meet. He/She would need multiple consumers of his/her services [a minimum of three separate jobs] and be able to demonstrate an element of flexibility in the arrangements.
An agency nanny for example who mostly provides emergency care arrangements might meet the criteria.

The issue is that the HMRC risk lies with you rather than the nanny. If you chose to believe someone that claims to be "self employed" and HMRC decide otherwise, it is you who will be financially and criminally liable not the nanny.

www.taxguideforstudents.org.uk/working/employed/am-i-employed-self-employed-both-or-neither
This is a helpful guide.

£10-12 per hour gross is the average for most normal families in Greater London. £17 is closer to Kensington / agency nanny wages which are all inclusive of NI etc.

It's worth putting a word out - lots of families have parents who work a 3-4 day week now and I see nannies often looking to fill an extra 1-2 days.
www.nannytax.co.uk would give you a good idea of what your additional costs would be.

Childminder would be cheaper but a nanny would be cheaper than two in nursery

Thanks that's really helpful. I obviously wouldn't want to do anything illegal or underhand. So sounds like they would probably be an employee, which puts me off! Shame there isn't a way to avoid this without acting badly. I imagine a group of nannies who got together, paid themselves a salary and provided the service for clients would be very popular!

Anyway, helpful to see the costs arent necessarily as high as £17ph but looks like a childminder might be a much lower stress situation.
Had (maybe naively!) thought a low hours job might suit a mum who wanted some work but not crazy nanny hours and I could have a fairly low key arrangement but seems that's not allowed.

Sometimes an agency may do a temp nanny on payroll but you start to get involved in VAT as once a company has turnover over a certain amount then providing the service becomes vatable.

Salary varies, it will be more than a childminder charges for one child and more than nursery staff are paid as it is 1:1 care not group care. A nanny is usually a viable choice when you have three or more children, or if the hours you need care do not fit with childminder/nursery.

Yes. I think it's not for me as I'm not a fan of filling out endless financial firms and would want to be a good employer. It also inevitably means getting involved in SSP and SMP at some point. It's just a lot of hassle and I'm not rich enough to justify paying an accountant to do it all for me. Imagine if a city council or LA started its own nanny branch, where you paid the council and the nanny was paid a salary. It would be great! I'm just musing that I can't be the only one who doesn't fancy being an employer, and there must be suitable people who would like to work in this area but don't really want all the hassle of childminding.

I imagine a group of nannies who got together, paid themselves a salary and provided the service for clients would be very popular!
But then you wouldn't be guaranteed the same person every week. While in practice you might get the same person, one of the definitions of self employment is the right of substitution.
You would have to meet any change in personnel with a guide on how the alarm works, not to let out the cat, directions to the school and after school clubs etc, and sign post the contents of the kitchen cupboards. You'd also have to do a handover on the children's physical routine [naptimes, milk and solids etc]

In practice unless you live in a small place where everyone knows everyone, it's a PITA to use an agency nanny in an emergency when your children are too small to verbalise any assistance.

Have you checked in case there is a creche at the university?

Plenty of people don't do it legitimately and would pay cash in hand for such a small number of hours especially given it is a short term, term time only requirement and you will presumably use a nursery once your oldest child can avail of funded hours? A nanny would have to earn more than £112 a week before he/she and you would be liable to pay NI. Obviously someone doing this off books across a lot of "employers" would a) avoid tax b) potentially be able to claim benefits illegally.

The actual additional cost of doing it legitimately is low. The annual payroll agency cost is a bit hefty though and if you take out insurances you are looking at close to £400 in set up costs.

taxaid.org.uk/guides/information/an-introduction-to-income-tax-national-insurance-and-tax-credits/national-insurance/national-insurance-for-employees-and-employers/national-insurance-with-more-than-one-job

I would say you are looking at £12/13 gross ph

Yes you may not want to employ someone as its hassle for you and yes you may find a nanny happy to do it for cash , if she had another 3/4 day job tho that would be illegal and I'm not suggesting that

Tbh you are better off using a cm to keep costs down :)

Thanks for the info all. It's been helpful. Signing off now as definitely will go for a childminder.