Welcome to NannyNest Child Care

As an employer, you are responsible for ensuring that the following steps are completed when hiring a nanny:

1. Verify the Applicant's Right to Work in the UK
   You must confirm that the candidate is legally allowed to work in the UK. This is a crucial step to remain compliant with immigration laws.
2. Obtain Employers' Liability Insurance
   Employers' liability insurance is a legal requirement and protects you in the event of any work-related injuries or illnesses.
3. Register as an Employer with HMRC
   You need to register with HM Revenue and Customs (HMRC) as an employer to ensure that you comply with tax and employment regulations.
4. Set Up and Manage Payroll
   You must set up a payroll system to pay your nanny. Alternatively, you can outsource this to a payroll service provider, who can handle most of these tasks for you.
5. Pay Statutory Benefits
   As an employer, you are responsible for providing statutory benefits such as maternity pay, sick pay, and holiday pay.
6. Deduct and Pay Income Tax and National Insurance Contributions
   You are required to deduct your nanny’s Income Tax and National Insurance contributions and pay them to HMRC.

NannyNest can recommend trusted payroll companies to assist you with these responsibilities. Payroll providers can ensure you remain compliant and help clarify the advantages of agreeing on a gross salary instead of a net salary.

Opting for a gross salary agreement can benefit both employers and employees. Below are some key reasons to choose a gross wage structure:

1. Fixed Costs for the Employer
   Agreeing to a net salary can result in fluctuating costs for you as an employer. You may end up responsible for covering your nanny’s owed taxes or outstanding student loan repayments. A gross salary ensures that your costs remain predictable and fixed, making it easier to budget and plan.
2. Compliance with Legal Responsibilities
   Paying your nanny a gross salary means you are fully adhering to your legal obligations as an employer. It also eliminates any ambiguity around tax and contributions.
3. Clear Employment Status
   There is often confusion among nannies and housekeepers about whether they are self-employed or employed. If you, as the employer, handle their tax contributions through payroll, this clarifies their status as your employee and avoids potential misunderstandings.
4. Pension Contributions
   When agreeing to a net salary, employers may inadvertently end up covering both their own 3% pension contribution and the nanny’s 5% contribution. This can lead to complications if the nanny wants to increase their pension contributions. A gross salary agreement clearly outlines both parties’ contributions and avoids unexpected costs.

By following these steps and opting for a gross salary arrangement, you can create a more transparent and stable working relationship with your nanny while ensuring you meet all legal obligations as an employer.