Not declaring a nanny and taking a "non qualified" nanny - thoughts ?

[monaco]

Hello all

so far, I thought that the only way to have a nanny was to hire a qualified one for whom you pay taxes. Yesterday, I talked to a mother who told me that often families actually often go for a nice student who gets on great with kids and they pay them cash so that they don't pay taxes.

My questions to anyone here is : what are the legal risks of doing that and has anyone have similar experience with a non qualified nanny and what did they think of it ?

I think if you only need a few hours (so pay is below NI threshold) it is actually ok just to pay them without having to register everything. Its not that dissimilar to paying a babysitter.

Thanks for that. Do you know what is the NI trheshold ?

I forgot to say that I'm looking for a nanny for 2 days but one of the day, I would be working from home so able to "supervise". My daughter would be 8 months old when we start.

Any concern ?

From the bestbear (childcare info) website:

Employees start to attract liability for national insurance contributions when they earn more than £79 per week, although you won?t have to make any contributions until they earn over £97 per week (these figues may change after April 2007) If you are paying your nanny more than this you are legally required to: register with the Inland Revenue as an employer and operate a PAYE (Pay As You Earn) scheme, keep a payroll, and produce yearly accounts of all payments.

So, how much are you intending to pay?

By the way, qualification is not relevant as regards liability to tax or not - your liability as an employer is just based on whether the person is your employee + earns over the threshold.

Thanks for your answer Bink. Is that net or gross salary ?
I will probably pay more than that as being in SW London, the going rate I think is minimum £7 an hour (net) and 2 days would be 20h.
The solution would be to use her only one day then !Or, declare one day but not the other.
Is anyone aware of people doing that and what are the risks/legal liability if you don't declare ?

I think you have to register as an employer regardless of how much you're paying.

Unqualified is not synonymous with paying cash in hand.

I was an unqualified nanny and my taxes were paid. If you are going to claim childcare vouchers, your nanny will need to be registered, which pretty much equals qualified, CRB checked and first aid trained.

If you pay your nanny cash and get caught, you'll be liable for all the tax etc you haven't paid, plus you'll be heavily fined.

Ditch all ideas about net pay now - it's confusing and misleading for nannies and employers. Work out a gross rate and pay her that. It gives you a more realistic idea of what it will cost you.

If you pay her £7 net and she has another job 3 days a week you may end up paying a lot more in tax than you need to.

When do you go back to work?

Personally I would hesitate about getting a student unless she had extensive childcare experience of some sort. It's not about the qualifications, it's about experience and being mature enough to cope with a baby. I also think there are ethical issues re the tax whatever the risks of getting caught (probably small)

Sorry if my questions were not clear. I was not linking unqualified and paying cash. I actually had two separate questions : 1) the liability of paying cash so thanks for the answer on that to all of you and
2) if anyone has experience with an unqualified nanny. I guess it's all about personal choice but I was interested in hearing opinions about that.

How do you actually figure out the gross pay ? And also, WanderingTrolley, can you clarify what you say about the nanny having other jobs (which would be likely since I would have her only for 2 days) and then paying more taxes ?

Oh also, during the day that I work from home and thus can be of help to the nanny, would it be acceptable to negotiate a lower rate that day ?

In terms of not having formal childcare qualifications, we have had two nannies of that sort, but they both had extensive experience and good references. Those really are the important things. One of them was quite young (22) but had helped bring up 3 stepbrothers and also worked her university holidays in a nursery. What I personally would hesitate about would be eg a university student who had done a little babysitting.

To your last question, I think the answer is "no". She still has to be there and if she is a professional nanny (qualified or unqualified), she could be selling her time at the going rate elsewhere...

In my opinion you would have trouble recruiting a nanny on the basis of paying her less when you are at home how would you feel if your employer suggested that to you?

RE: gross/nett salary this site is very helpful

nannyplus.co.uk/families/salary.htm

You are all absolutely right. It's great asking this forum as it helps getting the right approach to all of this.
I am not looking to underpay someone of course and I think it's important to pay someone the right amount for their qualifications. Was just trying to figure out the "modus operandi" out there.
Good point about the experience and good references.
This is all really helpful.
Any tips on where to advertise, ways to identify a "good" nanny when you interview, etc... ?

BTW, £7 per hour net is what was quoted to me by a mother employing a non qualified nanny.
What do you think is the going rate for a qualified nanny in SW London ?

virtually no-one agrees a gross salary though annoyingly. Not one person we interviewed knew what I was on about - they all wanted to know they were going to get a set amount in their bank account arrghh!

The website with gross and net pay salary is useful, thanks. However, with this issue of part time, how can you work out the decent net salary per hour working backwards from gross if you don't employ her full time ?
Or is it just a question of saying to the nanny : I pay you £9 gross and she figures out if it's worth it for her in net based on her other job ?

The nannyjob or gumtree websites can be useful although you have to sift the applicants very carefully and you may get many who haven't understood / read your ad properly. I used to use the Good Nanny Guide for interview questions but there are some good old threads on here somewhere on interview questions etc. For me the things that have been important:

• how the nanny interacts with the child / children at interview;
• what the referees say on the phone - the nanny you want will have previous employeers who think she is wonderful because anybody who has a good nanny is so damn grateful;
• gut feeling...

I've had several "non-qualified" nannies. I'm not particularly fussed about qualifications. I'm far more interested in personality, experience, and references. As an employer I feel it is my sole priviledge to decide what kind of degrees and experience deem one qualified to look after my child. Ofsted gets very hung up on some things I don't really care about and doesn't provide for other things I do care about. I like a fun sporty energetic nanny who will have the energy to take on a long day, but I don't really care whether or not my 4 year can read. Is there any evidence that children who read at 4 are more successful in university then those who read at age 6?

So I firmly believe that I can suss out a potential nanny far better than any standard qualification with a one size fits all design.

Now, as for the tax issue, can I just say I'm really dissappointed. I though tthis was going to be a good punch up thread. And it's all been very civil.

Pay in gross (as others have said).
Hire nannypaye.co.uk to do your paper work (unless you are geeky account who does this her self -- won't mention any names but the outer hebrides come to mind)

Consider the click factor when you make a decision.

Avoid agencies, unless you are loaded and happy to part with vast sums of hard earned cash.

Come here for advice. Many many nanny employers here have proved to be an invaluable support circle for a wide range of nanny issues. I'm sure other will agree.

Last but not least, come to our Southwest London / City meet ups. They are good fun, and there's usually some entertaining nanny chat to be had.

Eleusis, thanks for your direct post, love it !
I am certainly starting to think that the key will be to find the right person with experience rather than qualification and that I have to go for the click. Would ratehr do the selection myself, even it means work, as I don't trust agencies that much.

One last question to all: someone asked that in another thread but didn't get an answer yet. When would you recommend starting to look for a nanny, knowing that I would need her from May only.

Would love to go to the meet up. When and where are they ?

Nannies already in a job (and therefore with experience) will need to give 4 weeks notice at least, you will probably want 2 weeks of your ad being up to get good applicants and 2 weeks to interview, so around 2 months before you need her.

Bear in mind you have Easter around the time you'll be looking too, so it may be worth extending the search period by a week or so.

Yes, I agree with 2 months.

There's a meet-up on 1st of Feb in Richmond at Gaucho.