How do you work out nanny tax, NI and contracts etc?

[mouli]

We have a person willing to be our nanny, shared with our neighbour. Her parents are keen that everything should be above board and taxed etc. We looked up on the internet about nanny tax and she will be earning above £89 which is he limit for NI etc. What do we do now, how do you 'employ'someone? How do you make up a payslip with tax and NI deductions? Do we need special insurance? How do you get hold of things like P60 and P45 forms? Is it all too complicated and would I be better just using a nursery? We only want one days care per week. Please help me!

The limit of £89 per week for NI is PER EMPLOYMENT. If she's working for both you and your neighbour and the amount she is getting from you for one day's work is less than £89, which unless she's a very well paid nanny it probably will be, then you don't need to pay NI.

Your best bet is to phone the tax office. We employ a nanny and they have been really helpful explaining things, my dh does it all (an he is a man who is completely useless regarding numbers!)