UK insurance & tax obligations
What are the obligations when working as a nanny in the UK regarding tax and insurance requirements?
Working as a nanny in the UK it is key to be aware that there are obligations in relation to tax, insurance and so on.
Working as a nanny in the UK will depend on whether you are planning to work on a working holiday Visa or as a UK resident.
Being an informed nanny means knowing your entitlements and obligations.
An employer must comply with the legal obligations of being an employer such as it is the family’s responsibility to pay for the Tax and National Insurance on your behalf.
They must also allow you the other entitlements of any employee- sick pay and paid holidays.
Under UK law domestic employers have the same legal obligations as other employers. That means that they are legally required to register with HMRC as an employer and operate a PAYE scheme on your behalf.
What are the entitlements?
An employer has the obligation to pay the minimum wage which applies in spite of any benefits (use of car, phone, etc) that may be offered as part of the employment unless agreed as part of a salary sacrifice.
You are entitled to holiday pay if you are a full-time employee in the UK.
You are entitled by law to a minimum of 5.6 weeks paid holiday per year ( if you are part-time employees you are entitled to a pro rata equivalent of 5.6 weeks paid holiday per annum).
Sick pay is negotiable and not an automatic entitlement. You are entitled to Statutory Sick Pay (SSP) if you are sick for more than three consecutive days
Can a nanny do this?
No, it is not possible.
Self-employment is not available for a nanny in the UK as nannies generally they don’t meet the HMRC criteria for self-employment.
It is important to note that child minders and maternity nurses do meet the criterion and it is possible to gain self employment status as a nanny. You will need to contact the HMRC as they do sometimes grant approval. https://www.gov.uk/government/organisations/hm-revenue-customs
Where to go for more information
We would suggest the best place to access the most relevant, up to date information is through Nanny Tax.
Nannytax has loads of information. Information such as why most nannies cannot be self-employed, details about employer responsibilities (contracts, payslips, tax and national insurance liabilities, administering statutory benefits such as holiday pay, maternity and sick pay), public liability insurance etc.
In terms of nanny salaries, they conduct an annual wage survey with the nanny agencies they work with.
They publish the findings and average salaries in a national magazine entitled Nursery World every January and this usually generates a fair amount of national press interest.
If you would like to know more information in regards to the taxing and entitlements you should receive while working in the UK then visit www.nannytax.co.uk
