New Government Support, Self Isolating and Childcare Vouchers

[Toastnbutternjam]

So, our lovely nanny of many years is self isolating indefinitely as she has an underlying condition. As I’m now working from home and in danger of losing my job I’ve had mixed feelings. The new announcement that the govt will pay up to 80% of pay while this is going on is very helpful and a relief to me and her. I fully intend to find out how it works on Monday but in the meantime I wondered if anyone knows how it might work in my situation in practise? I pay my nanny with childcare vouchers - so if the govt step in to pay 80% of her salary, what happens with my childcare vouchers. Do I stop paying them to the nanny and save them up with the voucher agency for future use? I don’t want to stop the vouchers as I get a higher amount due to having used the same company and had the same employer paying them for many years. So how will these be affected by the government 80% pay offer and how will it work?

If your nanny has chosen to self isolate, then you would pay SSP.

The Job Retention Scheme is designed to continue pay part of employees’ salary for those employees that would otherwise have been laid off during this crisis. You are not considering laying off your nanny... if they were not self isolating then they would be coming in to work.

So in your particular situation I think you only pay SSP.

With regard to childcare vouchers, I expect those can be stockpiled for a while, so can be used in the future. Your voucher provider may be able to tell you for how long you can stockpile vouchers before they remove you from the voucher scheme.

You might at some point use a different childcare provider, so you may be able to use your childcare vouchers with them.

You may be able to pay SSP with childcare vouchers... vouchers are just a payment method, so as long as your nanny remains a registered/approved childcare provider then I think you can use vouchers to pay a Statutory payment.

This is all so much of an unknown at the moment. In your particular situation I think the key is that your nanny has chosen not to come in to work, rather than you deciding that there is no work for them to do and thus they are being laid-off.

With regard to the 80%... there is some information about Job Retention Scheme in these documents:

www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses

www.gov.uk/government/news/chancellor-announces-workers-support-package

Information about SSP:
www.gov.uk/government/news/coronavirus-support-for-employees-benefit-claimants-and-businesses

Legislation... the Bill is currently going through the process of becoming law: Coronavirus Bill (PDF) Follow the progress of the bill [[https://services.parliament.uk/Bills/2019-21/coronavirus.html here]. GovUK SSP calculator will be updated once the Bill becomes law.

Clickable link this time, I hope: services.parliament.uk/Bills/2019-21/coronavirus.html

Childcare vouchers don’t expire as long as you’re still in the scheme so you can save them up

‘HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement’ - Does this mean the employer still has to pay and they will be reimbursed. Or they stop paying and it is the employee who is reimbursed?

I expect it will be the employer who will be reimbursed.

"submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)"

"HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers."

HMRC does have a system for paying small employers Statutory Payment Funding, so I do wonder if they will use that in some way.
It would be more practical for HMRC to pay employers, than for HMRC to pay employees... it's a smaller number of transactions if they paid employers and then the employers used the existing payroll systems to generate payslips and pay the employees as per usual method (Cash, Chqeue, BACS, etc).
Who knows though what will happen... I expect HMRC are working on this and will release detail later this coming week.

I'm wondering how it will integrate with other systems, such as Tax-Free Childcare.

Our PAYE service are saying that they don't think personal households will be counted as businesses because we do not generate economic activity and therefore our nanny will not be eligible for the 80% wage cover from the government. This seems unfair, as we are employers, paying taxes, etc for our employee (part-time nanny).

Has anyone else heard similar or otherwise?

I did wonder about that Edeluna as it is 'domestic' employment rather than a 'business'... Although this situation clearly impacts on us as employers and our employees as it does everyone else.

Which payroll company are you with? I'm yet to get an answer out of mine.

I dont think it's been clarified- in some places it says businesses and in other places employers. I am also guessing nannies will be excluded - as there is an extra step - so I I most probably have to let my nanny go because our business is failing because of corona - not directly because of corona iyswim - but I have no more information on this that you guys- just a hunch. I guess if the government says no one should go to non essential work it might be different - may be.

Edeluna I have heard the same from my nanny payroll company. Although in the announcements they have used the terms employers and businesses interchangeably, the written documentation on the gov.uk website is specific that it is only for businesses.
We are employers but not businesses.

I’ve heard the same from our payroll company too. So DH and I are working horrendous hours under enormous pressure from home with no childcare and are paying our nanny in full.

Our nanny payroll company is way2paye by the way.

Nannytax say any employer with a paye scheme can potentially use the furlough scheme - not sure where they have got this from - their advice changed today

We use PAYE for Nannies.

It seems strange that our employees wouldn't have access to this wage protection since the whole reason it is being set up is to protect workers in this stressful time.

I'm hoping the furlough scheme will be applicable. Let's see what happens once the policy is more clearly defined. Stay well, everyone.

NannyPaye also seem to be more optimistic based on conversations with HMRC. Nothing definite however. Worth a look at this link on their website.

www.nannypaye.co.uk/covid-19

Thanks very interesting - hoping it’s just unclear and that if they say all employers then of course it should include us as employers of nannies even if we aren’t businesses

Seems like different agencies are saying different things. PAYE for nannies seem to be saying that nanny employers aren't businesses so won't be able to claim for furloughing, Nanny Tax are more positive and think they will. When/how can we know for sure. My childcare vouchers agency say they 'think' that as I'm paying in vouchers, that I would need to be paying in cash if I were to be able to claim anything. But again they don't know. Thought I would have some clarity by now. Anyone know how I can find out for sure?

It is all rather confused isn't it, and I think the answer is that they simply haven't had time to work out all the detail. I suspect we will simply need to wait for them to do so which is obviously very frustrating. That said, I can't see why the method of payment (ie childcare vouchers) should make any difference to the principle of entitlement.

We've agreed a furlough with our nanny. She's not coming in in light of the lockdown as she's not needed as we are both at home/non essential work etc.

If it is effective as our agency 'thinks' it will be based on conversations with the HMRC then so much the better. We've agreed with her that, for the moment, we will make up the 20%.

Thanks @whitepots this is what I'm doing too. I'm just going to continue to pay her for now but have said she is furloughed, she's not coming in and I will continue to pay her including the part that is through vouchers for now. But if it turns out that I can't reclaim that money I will be quite out of pocket at a time that is very financially insecure for us. I can see why people are making redundancies rather than wait who knows how long to see if they will actually get their money back.