Yes, it is a good idea to keep your financial affairs separate by both sets of parents becoming registered small employers with HMRC.
Nannywage Ltd register you with HMRC as part of our service.
Nannysharing
As more and more mothers return to the work place the demand for flexible and part time child care continues to grow. Parents recognise the advantages of having a nanny whose sole purpose is to look after the children on the parents terms in the parents own home where the children are comfortable with familiar surroundings
Although employing a nanny may be very appealing you may only require a nanny part of the week or be deterred by the nanny employment cost The solution to this for many parents has been nanny sharing and this form of employing a nanny has had a spectacular rise in recent years.
The nanny sharing can take several forms, for example;
One nanny looks after the children of one or more families at the same time At one location or on a rotating basis Nanny works for you on designated days only attending to your children The other employer on other designated days
Advantages of nanny sharing
The huge advantage of nanny sharing is that the costs of employing a nanny are shared by you only employing and paying the nanny for part of the week and the tax code allowance of the nanny being split on an earnings pro rata basis so that each employer only pays their share of the Tax & NIC. There is no reason that the employers who share a nanny need to know each other, but of course the nanny will restrict geographical boundaries as travel and availability are always to be considered
Nannywage Ltd have been operating nanny sharing for many years and will set up the tax allowance split with HMRC on behalf of you and the other nanny sharing employers. The only action you need to take is to complete our Nanny sharing questionnaire as we need the details of the other employer for the tax code split with HMRC
We do everything on your behalf, you need take no action safe in the knowledge that Nannywage Ltd are liaising with HMRC over the tax code allowance split on receipt of confirmation of the new tax code for your nanny we will immediately amend your employer file and recalculate tax based on the new tax code.
FAQ's
Should both employers register with HMRC
2) Should both employers issue the nanny with a contract of employment
Yes, although sharing the nanny both sets of parents are employing the nanny on a stand alone basis for the purpose of employment and each must provide a contract of employment.
Nannywage Ltd offer subscribers a FREE contract of employment as part of our service.
3) How are holiday arrangements managed
Both sets of parents should agree when and how holiday will be taken including arrangements should one set of parents want the nanny to accompany them on holiday.
These agreements should then be included in the employment contracts.
Nannywage Ltd will include in the contracts the correct pro rate statutory holiday entitlement for each employer
4) How is Tax & NIC paid
As we recommend both employers have separate HMRC small employer schemes each employer only pays their own Tax & NIC due on the employment of the shared nanny.
Nannywage Ltd manage all this on your behalf as per our payroll service.
5) What happens re disciplinary issues
Each employer will of course have their own rules of conduct, but should the nanny need to be dismissed from your employment as we recommend separate employer PAYE schemes this will not be a problem.
Nannywage Ltd as per our payroll service handle all leaving documentation on your behalf.
When completing your payroll form:
ONLY enter the salary you are paying the nanny NOT the total salary of both employers
When completing your contract questionnaire:
ONLY enter the days, hours and start / Finish times the nanny will work for you.
For example nanny works Mon, Tues & Weds from 8am – 4pm for both employers, we need your details Mon, Tues & Weds 8am – Noon
These are your employment details only and do not include the other employer who will employ the nanny Mon, Tues & Weds Noon – 4pm (Arrange details of start / finish employment times with other employer)