Childcare funding

[Throughtheforest2]

Hi
I’m just under the threshold so we’ve just got confirmation of 30 hours funding. We’re using most of this on preschool.
I understand that there’s also the 20% top up, which is worth up to £2000 per child per year.
If a nanny is ofsted registered can you use this childcare account to pay them?
And is it easy enough to use it to part pay nanny and use some to pay nursery fees.
Basically I’ve got 2 little ones, one in preschool one in nursery for half days and will then have part time nanny.
Trying to figure out the scheme as I’m currently on childcare vouchers but partner has new job so be lost his.
So think it would be worth switching systems if I can keep below threshold and he keeps job!
Any things to look out for consider?
Many thanks!!

You are referring to the Tax Free Childcare scheme which can be used with an approved/registered nanny. You mention Ofsted, so I assume you are in England. Yes, you can use Tax Free Childcare to pay an Ofsted registered nanny in England.
Yes it is quite easy to do, it involves paying in to the TFC system, waiting for the topup (usually with a day), then using the TFC online system to make the payment to the nanny. Note: The system does not work after 3pm Friday until next business working day.
The usual things with employing a nanny apply, so doing payroll, deducting Income Tax, National Insurance and Pension from the nanny and paying Employers National Insurance and Employer Pension. Pension is dependent on age and earnings level of the nanny.
The TFC account can also be used to pay HMRC the Income Tax, National Insurance and Employers NI. It cannot be used for the pension payments.

Do you currently have a nanny?

Thank you so much, super helpful
No, just interviewing for start in Jan
I’ve had people recommend nannytax website for payroll?
Not thought of pension to be honest. Is there a scheme people tend to use for nannies?
Great to know re account, so sounds like I can use to pay nursery and nanny - neither of them come to enough in their own right to make most of benefit.

I have heard lots of bad stories from nannies over recent months about Nannytax but I am sure there are lots of positive ones as well.

NannyPaye and PayeForNannies are two others to look at. Those are the big three in the UK. Then there are smaller providers, NannyMatters and Way2paye seem to get mostly positive comments.
I would suggest you pick a couple based on looking at their websites which will list fees and services, then give them a call for a chat and see who you get on with, who does not give you a hard sell, who answers questions you have confidently, who when you tell them you are looking to recruit a part time nanny tells you to make sure you agree a Gross salary.

Pension - Nest Pensions tends to be used as some of the payroll companies have got that to link in to their payroll computer systems which helps keep admin costs down.

I think your hardest thing will be finding a nanny who will work the hours you need. Be open to having a nanny who brings their own young child with them if you can as that could mean you have more applicants. Start looking around on sites like www.childcare.co.uk and www.nannyjob.co.uk to see if there are nannies in your area looking for work. Also look at other adverts from parents, to see what sort of salaries are on offer, though anticipate that for after-nursery care you may need to pay a higher hourly rate to make the shorter hours attractive.

Amazing, thanks so much!
We’ve had a lot of interest, not sure if it’s a sign of the times.
We’ve narrowed it down to 2 who are happy with the hours.
I just need to lay out details this weekend as term time is our focus but thinking we’ll also need help in the holidays.
I’m sure I’ll be back to ask for more help when I’ve figured that out!
The one I think we’ll go with has offered to renew her ofsted if we pay the £103 fee, she’ll pay to update her first aid - so we can use the 20% top up.
Seems to be coming together but need to iron out details!
Thanks again for help