A question re. nannies, NI and minimum earnings level

[chisigirl]

We currently employ a nanny two days a week. We are her primary employers, in that we apply her personal allowance when doing her pay. She works for three other families on the other three days of the week (1 day per week per family).

For various reasons we are thinking of reducing her hours to one day a week. But this would reduce her gross weekly salary to 85 pounds. I think this brings her under the limit for us to deduct NI? And, if that is the case, does that mean that she would no longer be building up 'credits' in the NI system (ie losing out on future benefits such as a state pension). I definitely don't want this to happen to her so want to make sure I understand all the implications before going ahead and cutting her hours.

many thanks in advance for any help!

havent a clue - sorry

not sure if a nanny can work for 4 employers - thought the limit was 3

sure Nick will know answers to both

Thanks, imananny. Oops, had never heard there was a maximum number of employers that a nanny can have. I think I need to make a call to the Inland Revenue.

There isn't a maximum number of employers, so don't worry about that. Presumably her tax coding for the other employers will have to be adjusted so that her personal allowance is fully used.

In terms of NI contributions, you are correct, the nanny will not be entitled to any contribution-based benefits (eg SSP) but will still be entitled to certain means tested benefits eg income support. However she does have the option of paying class 3 NI herself in order to retain the pension (and certain other) benefits.

She only has to pay class 3 contributions once (ie not per employer), and this is currently £8.10 per week. Of course she may already be paying Class 1 contributions for one of her other employers in which case this isn't an issue, though I would guess that that is unlikely if she is only working a day a week each.

Thanks, LadyMuck!