Self employed nanny- is this ok?

[Watergirl1]

I currently employ a nanny for my two children. She has worked for many years in London and has always been self employed. She already worked for 3 families when I employed her, we make it 4. She has one of my girls on 2 days a week (she is at nursery on the 3rd) and the other for 3 days. She has various combinations of children from the other families whilst she has my girls, but never looks after more than two families children at the same time. For example she will pick up my girls, go to a playgroup and pick up another child on the way. She may then drop that child at nursery and pick up another from school later. She charges me £6.50 gross for one child and £10 gross for both. I presume when she has other children alongside my girls she is charging the other families the same so may get £20 gross combined at times from both families. Does this sound ok or do you think she should be on PAYE with us? She probably looks after our children the most but not sure what to pay her if she has other children for a few hours at the same time. She works pretty regular days for me but it changes during the school holidays and she occasionally does extra hours. We pay her holiday and sick pay and she is actually retired so already collecting her pension so I presume we don't pay towards this? Sorry for the long post but it's a bit complicated!

Where does she have the children? At hers or at yours?

That sounds like a similar setup to what I have with a Carer who is also self-employed.
Check with HMRC if you're concerned, but if she is providing services to several families then it makes sense for her to be self-employed.

She sounds more like a childminder.

Where does she care for these various combinations of children?

But paying holiday & sick pay implies she is employed rather than self employed.

As mentioned by MyWineTime HMRC can help, they have several tests to help you (and them) decide if someone is self-employed including do they work for other people, do you know their self-employed tax registration number, do they provide their own equipment etc. Payment of holiday and sick pay looks like she is an employee rather than self employed.

At the moment you could be in muddy waters - if you and her are in agreement that she is self employed one way to make things clearer is to have a 'contract for service' (as opposed to a contract of employment) in place that you both have signed and also had a witness (ideally an independent professional e.g. accountant or lawyer)

Thank you, that's helpful. She has the children at my house and then goes out to playgroups/ soft play etc locally. She wouldn't normally bring other children to my house.

I'd missed the holiday and sick pay bit - that indicates employee.
I only pay my carer for the hours she actually does for me.
I agree that she sounds more like a childminder.

May be an employee when working for you but self employed when doing ad hoc work for other families.

The holiday pay and sick pay would indicate employment is more likely. Work they do for you seems to be very regular and same time/day each week - is that the case? Are you deciding when they work and when they don't? If so then that would also point towards employment.

Can they say they are not coming to work whenever they like - or are you insisting they call in as sick or take paid annual leave? If they can't decide when they work and when they don't then they are probably an employee.

Often best to assume a nanny is an an employee, whereas with an occasional evening babysitter you could fairly assume they are running their own business.

What has prompted you to ask?