after school childcare and employment status

[tigger15]

DS is starting school in september which means that we need to rethink our childcare arrangements as current mix of childminder and nursery won't work. The idea that I've come up with is someone(s) to take him into school in the evening, pick him up in the afternoon and stay with him until 7pm and then school holidays. I'm still divided on whether it may be better to split this between 3 people.

I know people who have done this successfully and they informed me that if you do it in this way you don't need to pay tax or NI because the person is effectively self employed and providing a service. Is this correct? My recollection of the position 3 years ago was that if a person is employed by you then only if they earn less than £100 a week do you avoid paying them NI and if they are a contractor as opposed to an employee then again you will not be liable for NI. Does anyone have any advice on the above?

To my knowledge there is no minimum amount of time that someone works that is a factor in determining employment status.

It is far more IMO to do with the bigger picture of that person's overall working. So if they provide a drop off to school service for multiple families on an ad-hoc basis then that MAY point towards self employment.

Some of the status officer manual is available online, may be worth a read ... Will see if I can find a link.

Thanks a lot. I'd be interested in seeing the link.

Employment Status Manual

You will not find anything specific to childcare alas. There is an Occupations list but childcare is not on that list. Closest match may be Careworker in Clients Home.

With regard to the figure you gave earlier... it's called the Lower Earnings Limit (LEL). For 2010/11 it is £97 per week. Source
If someone earns less than that then special arrangements are in effect BUT it does not apply if they have other work. See PAYE: When you need to register.

Why would keeping your existing childminder not work? Are they unable to take/collect from the school? Maybe they know another childminder who can take/collect from that school.

We hired someone who also worked as a TA to do this sort of job for us when DS started nursery-school at 3. It worked very well, and was probably the least hassle child care we have ever had.

But, we did pay tax and NI as it was a second part-time job for the girl concerned, she was by no stretch of the imagination self-employed.

We offered a gross hourly rate of pay, paid her weekly in cash with a typed payslip to summarise her hours that week, gross pay, net pay and also what we had paid the Inland Revenue as employers. It sounds a hassle, but wasn't really (certainly compared to the other child care options we had used) and it kept everyone straight. We paid the revenue lump sums when they expected it - I think every 6 months (it was a while ago now).

Her other employer knew that she had a second job - I talked to the headmistress to get a reference before she started, and they actually juggled her hours a little so that she had time to get to the nursery on time to pick ds up.

We did pay for her travel time (she was coming about 20 miles each way) at the same hourly rate as a contribution to her petrol costs. We also asked her to insure her car for work use, which she did.

The only minor hassle we had was that the two schools concerned had slightly different holidays, so we had to work out a mixture of MIL coming to stay, taking odd days holiday and so on to cover the (lack of) overlap.

Nick -the only childminder who will do pick ups at the school(no one does taking) is not legal and has too many other children for me to be prepared to use her. My existing one lives a 25 min walk from the school and is not prepared to do it plus she is cutting her hours from september. Most of the parents are SAHM or else teachers able to shift their hours to do pick-ups.

Neversaydie - I'd be interested to hear how you managed that. Did you calculate that yourself and produce your own payslips or get a company to do it for you? I was really looking for a easy and cheap way around this change in schedule but need to do this legally.

Is this a state school? All schools are required to either provide wraparound care themselves or they will have details of a local provider who will do this. For example, the schools in my area don't provide their own care but a local day nursery drops off and picks up from all of them. I'm not sure what happens in the holidays though! They are also flexible about children who have staggered reception starting hours which can last for up to a term.

It is a state school. That sounds interesting I'll see what I can find out.

If you have an extra room, I find the most flexible form of childcare once dc hits school age is an aupair.

They are live-in (so you must be happy with that), depending on hours and duties, cost between £70 - 110 per week for about 25-35 hours of duties at week, comprising schoolrun, light housework and childcare. They can also cover holiday care for extra pocket money.

If you keep their weekly pay to less than £100 per week, you don't have to worry about their income tax or NI. Draw up a simple employment contract. If you recruit from EU, you don't have to be concerned about Visa requirements.

The tax stuff was pretty straightforward because all her allowances were on her first job, so it was just a standard percentage off the top, plus the NI. I think I had a readyreckoner programme that the Tax Office supplied me with (it was 7 years ago). I actually found the tax office very helpful when I called them and asked about it all - it is after all in their interests to make it as easy as possible for small employers to get it right.

I suspect that a lot of the problems people have with paying a Nanny's tax is because they expect to be offered and get a net salary, so it all has to be calculated in reverse, which must be an absolute pain if you are not particularly matematically inclined.