Tax and National Insurance

If you employ any Domestic staff in the UK and you pay the employee more than £105 per week (tax year 2011/2012) you have the same legal responsibilities as a commercial employer and the law requires you to:

  • Register as an employer
  • Set up and operate a PAYE scheme on your nanny’s/manny’s behalf
  • Keep tax records on thier behalf
  • Provide your Nanny/Manny with regular payslips
  • Provide him with an employment contract
  • Pay regular income tax and National Insurance Contributions
  • Pay employer’s National Insurance Contributions
  • Provide an annual account of all deductions.

As an employer you are also responsible for paying Statutory Sick Pay and Maternity Pay – but the latter may be reclaimed in full from the state.

  • File an employer’s annual tax return which must now be up-dated monthly.

National Insurance Contributions go towards your employee’s entitlement to unemployment and state pension benefits. Nannies/Mannies are increasingly aware of their rights as employees and an employer who takes care of their Nanny’s/manny’s PAYE properly will be considered a good employer in this respect and enjoy the increased confidence of their Nanny/manny.

We provide a Nannytax service currently standing at £260 including VAT per year.

For more information, help and advice, please do not hesitate to contact us.