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PAYE and National Insurance Contributions:

When employing a Nanny and paying them more than the tax and national insurance threshold, the law requires you to:

  • Provide your employee with a contract prior to commencement
  • Register as an employer with HMRC
  • Keep a payroll record and provide payslips to your Nanny, Governess or Governor
  • Pay Employers National Insurance which contributes to the Nanny’s Statutory Sick Pay, Statutory Maternity Pay, Unemployment and State Pension Benefits
  • Where applicable pay Employee’s Income Tax and National Insurance Contributions
  • Annually, you will be required to file an Employers annual tax return
  • Enrol with the Workplace Pension Scheme, where applicable
  • Those that do not declare their employee’s earnings are committing a criminal offence and the risks involved thereof
  • Have employer’s liability insurance in place (this is often covered in your home insurance so check that 1st before shelling out more money) if you don’t have insurance https://www.mortonmichel.com/employers-liability-insurance can help

    If you need support with payroll etc. you can enlist the services of a payroll company, we recommend www.nannytax.co.uk. a bespoke service who can assist you with payroll services and legal obligations pertaining to employing staff.

    Pensions – Auto enrolment

    Auto-Enrolment is a law which requires all employers – including Nanny employers to ensure they have a pension in place for their employee.  Your Nanny and you as the employer contribute to your Nanny’s pension.

    • All UK employers now have to offer a workplace pension for an employee as soon as they begin working for them.
    • If your Nanny is aged between 22 and the State Pension Age and earns above £10,000 per annum they will qualify and will need to be automatically enrolled.
    • You can work out when your Nanny will reach State Pension Age by using the Government’s State Pension Age Calculator on www.gov.uk .
    • If your Nanny is automatically enrolled, they can opt-out if they do not want to take part.
    • If your Nanny does not qualify to be automatically enrolled, they still have the right to join a Workplace Pension.


    Should your Nanny opt in, the minimum costs of Automatic Enrolment for Nanny employers and Nannies are:

    Employer contribution: 3% Employee Contribution 5% Total minimum contribution: 8%



    As an employer you should ensure that you have Employer’s and Public Liability insurance cover.

    • If the Nanny is to have the use of a car to perform duties, they must be appropriately insured.
    • Employers are responsible for their employees while they are doing work-related activities or are traveling as a result of a work assignment.
    • If you require the Nanny to travel, an employer would be wise to provide travel insurance for employees, since the employer is ultimately responsible in the event that something happens to the employee.
    • Should an employee have an accident or suddenly get sick during the trip, the employer will have to pay for the hospitalisation and doctor’s fees, as well as any emergency transport back to the employee’s country of residence.
    • The same goes for other eventualities, such as cancelled or delayed trips, personal liability and lost baggage.

    International Vacancies- Employers Legal Responsibilities

    During the search for a Nanny, the salary expectations are always quoted net of tax and in GBP.  On top of any GBP figure quoted, you are expected to add on to this figure any taxes, social security etc. that are lawfully applicable.

    When you select and then enter into a contract with the Nanny the net figure agreed will be converted into the gross figure and currency used in the country within which you are employing the Nanny.

    Provide the employee with a contract (terms of employment).

    Provide a work permit for your employee / Register your employee with the appropriate authority.

    Ensure they have access to medical services & travel & car insurance if required for performing duties.