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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

Any advice - my mum wants to be our nanny (tax and sanity questions)

22 replies

gillhowe · 12/08/2007 09:12

Hello, any advice / experience gratefully received....

Is there any way I can use childcare vouchers to pay my mother for looking after DS (she is a nursury teacher so Ofsted wouldn't faze her)? Also has anyone had their mum look after their kids / is a mum looking after their grandchild?

Thanks!

OP posts:

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startouchedtrinity · 12/08/2007 09:34

I come at this from a different angle as I was looked after by my nan. It was wonderful to be cared for by someone who loved me unconditionally and my mum often talks about how fantastic it was for her to be able to have her rewarding career knowing exactly how I was being loved and treated just like she was when little. HTH

Katymac · 12/08/2007 09:36

Whose house

Your & she is a Nanny - & needs to register to accept vouchers

Hers & she is a childminder - & needs to regoster AND look afetr another child in order to be able to accept vouchers

Original poster

gillhowe · 12/08/2007 09:40

Starthouchedtrinity - thanks for that, its a lovely point of view.

Mum would come to our house, I've just been looking at registration requirements and it looks like a teaching qualification isn't on the list - don't fancy sending my mum on a childcare course!

OP posts:

ChasingSquirrels · 12/08/2007 10:10

I am pretty certain that you can't get the vouchers in this position, though if you prove me wrong let me know and I'll be doing it aswell!

My mum has my boys 3 long mornings a week, and tbh if she couldn't/wouldn't have done so I probably wouldn't have gone back to work. I was gobsmacked when she offered (they lived 200 miles away at the time and came and stayed with us for 2 days a week - have since move to about 10 miles away and I have changed my hours). For me, there is no one else that I would rather have my kids.

They also go to a CM once a week.

ChasingSquirrels · 12/08/2007 10:23

pg3

Original poster

gillhowe · 12/08/2007 12:16

Thanks for that Chasingsquirrels, I'll look at the link now.

I didn't think you could use them unless your mum had a childminding business, but I want to make very sure! TBH I think its really annoying, I'll be paying her market rate and it seems mad that it would be cheaper to send DS to someone else.

My mum lives 200 miles away as well - she is going to come to stay 3 nights a week. Like you I think that I wouldn't be going back to work if she hadn't offered.

OP posts:

NannyL · 12/08/2007 13:50

I dont think that child care vouchers can be used to pay close members of the family (ie your mum)

even if she is already a childminder or a nanny im quite sure you still cant use the vouchers.

i think you can pay her like any other normal person though, just that the government wont let you use the vouchers for it

Original poster

gillhowe · 12/08/2007 15:49

Yep, so she pays her tax and NI and I pay employers NI but I can't get any tax relief for it grrrr !

OP posts:

NannyL · 12/08/2007 17:26

if its in your house then surely you would have to pay her tax and NI?

Cause thats the way it works... if you have a nanny you have to pay the nannies tax and NI etc!

ChasingSquirrels · 12/08/2007 18:28

You don't HAVE to pay the employees PAYE and NI when you employ a nanny - it is just the way that nanny contracts are traditionally structured.
If tax and NI is being correctly paid over then it doesn't matter whether you have quoted a net rate (and you bear the PAYE and NI costs) or a gross rate (and then deduct the PAYE and NI).

NannyL · 12/08/2007 18:34

if you employ a nanny than you as the employer are responsible for enuring nannys tax and NI and employers NI gets paid, and if you dont then you will be fined £3k should inland rev find out.

the only way you can be sure its being paid is to pay it yourself other wise nanny may say she i paying it but may be spending the £ herself

It is not legal for a nanny to be self emlpoyed... nannies have to be employed... and it is the employers repsonsiblitly to deduct tax / NI / student loans etc at source

ChasingSquirrels · 12/08/2007 18:41

I agree - this is the case for ANY employer, the difference is that most nanny contracts are structured so that you quote them a net pay, but you don't have to - as long as everyone knows what is going on you can quote them a gross pay - meaning that they rather than you gain (or lose) if their tax coding changes, if NI rates change etc.

The employer does have to ensure that it is deducted from their pay and paid over to HMR&C, as does any employer.

NannyL · 12/08/2007 18:49

also while alot of us agree a net pay it is always coverted to gross in the contract for the sake of employer and nanny.

all of my contracts (and as far as i know all my nanny friends) have gross in our contracts and wouldnt have it any other way!

ChasingSquirrels · 12/08/2007 18:52

In which case your employer isn't paying (as in bearing the expense) your PAYE and NI, they are simply remitting it over to HMR&C, as any employer would surely?

OFSTEDoutstanding · 12/08/2007 18:52

I was self employed when I was a nanny and it saved alot of messing about with tax and ni for my clients!

NannyL · 12/08/2007 19:35

ofstead outstanding: a few years ago (i think its 3 years ago, maybe 4years now back on 6 april) they changed the law so that nannies cant be self employed

Chasing squirrels... i dont quite understand what you mean... yes my employers are employers and like all employers pass on MY tax and MY NI to inland rev... like everyone elses employers do!

Howevere most nannies i know agree in interview a net salary... so we know how much cash we have to spend, but in the contract it is written as a gross figure for if tax brackets etc change.

This is the way most people who employ nannies do things as far as i know!

ChasingSquirrels · 12/08/2007 19:42

All I was saying was that you don't HAVE TO agree a net pay with a nanny initially (and then convert to gross), you can agree it gross upfront if you both (employer and nanny) agree.

You posted
" By NannyL on Sun 12-Aug-07 17:26:08
if its in your house then surely you would have to pay her tax and NI?

Cause thats the way it works... if you have a nanny you have to pay the nannies tax and NI etc! "

All I was saying is that she (the employer) doesn't have to bear the cost of the PAYE/ee's NI.

All of which is academic, as it's her mum not a nanny and she can agree the terms she wants. She could even gift her mum a sum of money each month (as she is entitled to, the only potential tax being IHT) and her mum could look after her grandkid(s) as a grandparent, because she wants to and not for a fee. It could be challanged by HMR&C I suppose, but the chances of it happening?

NannyL · 12/08/2007 19:46

ok i think we are saying the same thing!

essentially we all agree to a gross wage in our contracts!

misspiggy · 12/08/2007 20:11

Just read the OP but not all of the thread so sorry if repeating.......

My mother looked after DS2 from 14 months old until he started Reception. I found that there were many good points

DS2 adored my mum and vice versa so I never had any worries that he wouldn't get enough attention, cuddles etc when I wasn't there.
She came to my house to look after DS2 and that was a real advantage in the mornings as it cut out the dash to the childminder's house (sometimes in the pouring rain!) and he had all his own things around him.
Mum didn't want paying at all but I insisted on giving her a little something every week. This really helped me financially (DS2 is 11 so this pre-dates childcare vouchers) as I was a lone parent at the time with DS1 who was at school and DS2.

However, what I did find hard was that Mum and I had different ideas on discipline (she was very indulgent with him and I tended to be a bit stricter) and on what DS2 ate every day. She was loathe to try him with new foods as he didn't like them and she let him have lots of "treats" to the point when they were expected and therefore not a treat anymore IYSWIM. DS2 remains unwilling to try new foods at age 11 and has a very sweet tooth.

I am quite a nice mum, honest!

If mum had been a childminder / nanny I could have addressed these issues a lot easier than me telling mum that what she was doing wasn't how I wanted her to look after DS2. I tried on a couple of occasions but ended up upsetting her which was the last thing I wanted to do.

I guess a lot depends on the kind of relationship you have with your mother. I'm sure you'll come to the right decision.

Good luck.

Original poster

gillhowe · 12/08/2007 20:34

Sorry about any tax confusion! I am actually a tax accountant so I always think of PAYE and employees NI as the employees cost (even though I have to pay it over).

Income tax is not my field of expertise though so I don't know anything about childcare vouchers (am finding out now though).

OP posts:

Original poster

gillhowe · 12/08/2007 20:36

Oh and thanks Misspiggy, I think my main problem would be that my mum wouldn't respect any of my views at all!

OP posts:

ChasingSquirrels · 12/08/2007 22:56

lol, I'm an accountant aswell.
Re the disagreements, I am pretty close to my mum and while there are a few (minor) things that I don't agree with her on, I have taken the view that they aren't worth getting het up over and so I haven't said anything - but as I said they have been minor, not sure how I would feel about more major things - but luckily they haven't occured as we are pretty similar in the way we treat the kids, although she is slightly more indulgent (as grandparents should be). I guess she brought me up the same way and I pretty much agree with how she did it.

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