Query, is this a live-in, or live-out nanny, as employment law does not often cover live-in domestic staff!
Employers Liability Insurance - this is usually in your household insurance policy, though check with your insurer, especially if you have accidental damage cover.
Doing payroll for one employee who works for you full-time and has no other employment is really quite easy, you don't need to use a payroll service - see P49 . HMRC will provide much of what you need in the new employers pack, including a CD-ROM for PC which has calculators on it to help fill in the paperwork. If you want the reassurance of someone else helping you do the paperwork, then use a payroll company, but don't feel that you have to do so - my employer doesn't use one. I would suggest trying to start it yourself, and if you find you get really stuck and with the New Employer Helpline's help you still feel stuck, then use a payroll company.
If you do want to use a payroll company, use TaxingNannies or NannyPAYE , both seem to know what they are doing and are friendly to non-clients making initial enquiries.
Not sure the £250 money back thing still exists. Online Filing 2007 indicates that it is £150 for the 2006-07 return. The TaxingNannies website also mentions it being £150 and dropping to £100 and then £75 over coming years. Avoid factoring this rebate into your calculations - see it as being a bonus if you get it, as over time it is likely to reduce and getting the payment is not guaranteed.
Not sure I understand what you are trying to do regarding the holiday entitlement. Presuming the nanny is live-out, then you have to give the statutory holiday entitlement - currently 4 weeks, thus 20 days if working 5 days per week. Holiday Rights information - Possible increase in Holiday Entitlement from October 2007 As NurseryJo has said, using the Accural System may be best, so your nanny gets holiday based on how long she has worked for you. The Accrual System can only be used for the first year of employment.
Coming home a little late... this happens in my job on occasion due to the M3 traffic. Over the course of a year, it evens itself out, as some days you will be early, others late. If you find that you are 'owing' time, then you can always give your employee a day off.
Contracts - if using a standard contract, make sure you add to the Gross Misconduct section, so that it shows clearly what is considered to be a sack-able offence. Tribunals don't seem to like there being lots of things in that section, so make the disciplinary procedure clear, so that when it is not gross misconduct you can issue a written warning, and after two of those then you have reason to dismiss your employee.
ACAS is a good place to visit for information about how to prepare a contract, including Producing disciplinary procedure .
CRB checks - employers still can't get these done on individual employees. But if you register your nanny on the Ofsted Childcare Register (in England), then they will get an Enhanced CRB check via that process. Your nanny will need to be on the OCR scheme if you intend to pay using Childcare Vouchers.
OCR officially launches on Monday (16 april) so for now old scheme can be found at Childcare Approval Scheme website .