Sorting out a Nanny payroll

[Rattiekins]

I am on the verge of employing a Nanny for the first time. I know I have to be her employer and thus sort out her pay and other tax stuff. I was hoping that someone could give me some tips about how they sort out the payroll / NI / PAYE stuff. What type of person does this and how much do you pay? I have heard of Nannytax but not sure if that is a good option / my only option! Replies will be wonderful. My email is tratkins at fish dot co dot uk if you prefer.

We've used NannyPaye for the past 3 years - they're great, absolutely no problems, and a lot cheaper than Nannytax.

we used nannytax and have never had any problems - have no idea if they are more expensive or not! they were always super-efficient and prompt with any query...

Thank you so much for the ideas so far. One question. Do we as the employer pay NI employers contribution on top of their gross wage or is it not something we do (is it optional? and if so do people tend to pay it?
There seems so much to sort out and cost up!

yes - but nannytax work out how much etc - we got a bill quarterly to pay off our tax/ni debts (ie nannytax tell you how much to pay the nanny NET and you pay the rest directly to HM) nanny does not pay her own tax... am I making sense?

I do our Nanny's tax myself, using the calculator on the Employer's CD. It can be a bit of a pain to begin with, but the HMRC new employer helpline is actually quite good!

I send a payment every quarter direct to the tax office over the internet.

Cosette

If you do this, do you create payslips for her? And do you do childcare vouchers too? I will want to do both of these things, but am thinking that needed these two rules out the route of doing it yourself...

My employer does it herself - writes out payslip (two copies, one for the file, one for me). I'm paid by Childcare Voucher - it does not seem to complicate things.

I would recommend PAYE for nannies;they were the cheapest when we started, sort everything out and send you monthly or weekly payslips which tell you what to pay. Then it is down to you whether you pay by cash, cheque, vouchers or bank transfer. V You also have to pay tax and NI to Inland Revenue every quarter. Very simple. You can still get some money back if they file your annual return for you online, so it makes it very cost effective; about £40 this year.

Rattiekins - yes I do payslips myself, and we use childcare vouchers - Accor.

I also filed my own return online - so got £150 off my tax bill last year, and I think it's £100 this year.

i do it myself, after nice lady on hmrc helpline told me it was very easy and not to waste my money on payroll agency. three months in am wishing i'd wasted my fecking money on payroll agency - i have no problems doing my own tax return and think i'm quite financially literate but it has been, quite frankly, an enormous pain in the arse. pay an agency and it's one less thing to worry about

No, just make it available for us all to download

I'd like a copy... any chance?

Another vote for nannypaye, they have been great, although I am an accountant and that I am too lazy to do it myself. If you use an agency you still get the money back for filing online - they pass it on to you. Using childcare vouchers doesn't make the tax side of things any more comlicated, you can only use them to py your nanny's net salary, not the tax part, and it's just an extra separate thing that you need to set up.

Re your NI question, yes, it is compulsory.

I do it myself via a spreadsheet (aah us accountants, aren't we great? ) but I still forget to run the spreadsheet (she gets paid weekly) to produce the payslip every now and then doh!

so on balance, yes go with someone who will do it for you! then you don't have to worry about it at least.

Thanks Jura.

Thanks for all your replies. I think I will go with an agengy for the first time round... I dont think I would be certain to get it all right.. nearly missed the calculation for NI employers contribution when working out the figures to pay the nanny. I have already got to work out the pro rata bit as for some of the year I am going back only part time and then go back fully come the spring! Also there is loads to learn when starting out with a nanny.

The spreadsheet sounds great Jura. Would you mind including me on your list of people to send it to. One year in and I can see myself doing the payroll. tratkins at fish dot co dot uk. Thanks!

Loads of recommendations to follow up. Looked up an old thread on mumsnet and has negative things about Nannytax and nannypaye... but I guess not everyone is perfect. Just want an agency that reponds well if they do muck it up (which hopefully they wouldnt!). Looks like the popular and good ones are Nannytax, PAYE for Nannies and nannypaye.

As a nanny, I've just filled out the paperwork supplied by PAYE For Nannies. From first look, seems like they are covering all that's required - even had a P46 in the pack (so they don't assume that it is your nannies only job).