When you employ a nanny in the UK you need to deduct from the nannies pay Employee Income Tax and Employee National Insurance (NI). As the employer you also have to pay HMRC a tax called Employers National Insurance.
If you are considering employing a nanny it can be useful to get a feel for what these costs are likely to be over the next financial year. 2012/13 financial year starts in April 2012 and PAYE Calculators have been updated to include calculation of the new tax and NI amounts. These calculators should not be used for day-to-day payroll, as for that you should follow the procedure set out by HMRC but the tax/ni calculators do give very good figures for what you are likely to pay.
My preferred tax and NI calculator was written by an accountant towards the end of 2009. That accountant posts on various internet forums including Mumsnet and thus uses his forum username as it’s title: MrAnchovy’s PAYE Calculator 2o12/13
MrAnchovy’s PAYE Calculator is my preferred nanny tax and NI calculator due to it’s ability to do Gross to Net and Net to Gross calculations. It also has a simple to use interface, though it does need to be used on a modern browser and does not support usage on a mobile browser.
MrAnchoy's PAYE Calculator
The tax calculator is just a single webpage which has different coloured boxes. You enter in details in Blue boxes and click the calculate button and the page will update to show the values in the Grey and White boxes. It enables you to specify: Tax Code, Days worked per week, Hours worked per week, if the nanny has a student loan, either the Gross or Net hourly/weekly/monthly/annual salary.
The tax calculator will start with some defaults… tax code of 810L for example, which is a typical single person’s tax code for 2012/13 financial year. Your nanny however may not have this tax code, so until you know your nannies tax code (this is established via a P45 or P46, plus coding notices from HMRC) it is wise to run the calculator twice… once with 810L and once with code BR. BR is the code used to not allocate any personal tax allowance to the job… thus all income is taxed. That will most likely be the situation if your nanny is part time and already has another job, as their primary job would be using their personal tax allowance.
Another PAYE Calculator is ListenToTaxman which I used before I heard about MrAnchovy’s tax and NI calculator.
Take a look and see which nanny tax calculator you prefer.
For more information about income tax and national insurance and employers obligation to operate PAYE, see the PAYE section of the HMRC website.
There are nanny payroll companies that can help you with producing payslips for your nanny and telling you when and how much to pay to HMRC. My own payslips for over 3 years have been produced by PAYEforNannies, so do take a look at that company.
Nannies in London seem to me to be able to earn more than nannies outside of London, even those who nanny 20 miles outside of London.
Nanny agency The Nanny Tree (follow them on Twitter) recently posted some details of the salaries of nannies they recently placed in nanny positions in Greater London (inside the M25).
Richmond – 50hrs – 5yrs nursery exp, 18mths as a nanny, 1st aid & CRB, willing to become Ofsted registered £13.50 Gross
(cost to employer 2012/13: £39,022 Nanny take home (810L) £2205 per month)
Wimbledon – 40hrs – 3yrs nanny exp – 1st aid & CRB, Ofsted registered £12.05 Gross
(cost to employer 2012/13: £27,570 Nanny take home (810L) £1635 per month)
Croydon – 40hrs – 5yrs nanny exp – 1st aid & CRB, Ofsted registered £13 Gross
(cost to employer 2012/13: £29,825 Nanny take home (810L) £1747 per month)
Richmond is in Surrey. I also nanny in Surrey, so would you expect that I was on a similar salary? Well I can tell you that as I nanny just outside the M25, my salary (when calculated hourly) is around 20% lower. As the bird flies, Richmond is about 11.4 miles away from where I nanny.
Why the difference – it is impossible probably to know. No two nanny jobs are ever probably exactly the same. Parents have different incomes and have higher or lower expenditure. A nannies salary is something that parents decide and then offer the job at the salary they have determined. Nannies either apply for it, or they don’t.
There are bound to be nanny jobs in other parts of London which are paid higher and lower. If you are thinking of working as a nanny in London, don’t expect that all jobs will pay this sort of salary… some won’t. If you are a parent in London considering employing a nanny, then calculate what YOU can afford to pay and feel is right to pay for the job on offer.
Do I want to be paid more… well, not if it means moving to Richmond. I would far prefer to live in the place I live and work in the place I work. Richmond may well be nice, it may well be less busy than central London but from my past visits to that area I would say it is more busy than where I live and more heavily populated.
Nannies may compare salaries but the salary isn’t the only thing that makes a job a good job – the relationship with employers (parents) and the children is also an important factor. People change jobs for various reasons, salary may be a reason but it isn’t always the reason.
So whilst the pastures may be greener elsewhere, I for one am perfectly happy where I am, even if that means I am not being as highly paid as other nannies in other parts of Surrey.
How much it costs to employ a nanny in the UK is something that is often asked on parenting forums like Mumsnet and Netmums. I find myself often preparing cost calculations for parents, so today I will write about how I calculate the cost of a nanny.
Nannies Salary
Start off by picking a figure for the nannies salary. This can be tricky to decide and will vary from one part of the country to another, even within the same town or city the salary that nannies are offered could vary quite a bit. There are various factors which may affect the level of salary, such as how much experience is desired, if the nanny is expected to work unusual hours, varying shift patterns perhaps.
At the time of writing (February 2012) jobs are thin on the ground, so it is what I would term as being an Employers Market. Employers can offer jobs at whatever salary they like and see who applies. You may well be able to get a great nanny with lots of experience for less money than you could a couple of years ago, as people need jobs at the moment and it’s better being in a job than job hunting. So an experienced nanny may take a job at a lower salary than usual, in the hope that salary increases over time, which is likely to happen though the increase may be quite small.
As job applicants may be expecting the salary to increase over time, take that into account when working out what salary to offer. Work out your budget and offer a salary below your budget, so that you have room to increase the salary say after the initial probation period and at the end of the year.
Get a feel for what other jobs, nannying and non-nannying are paying in your local area. There are many job sites on the internet which will give you a feel for salaries on offer.
Nannies I would say would typically be paid £7 to £13 gross per hour. Less than £7 I would have thought would be quite rare as £6.08 is National Minimum Wage for someone aged 21 or over, so an experienced nanny I feel would be wanting more than NMW. An inexperienced nanny in their first job however may be happy to accept a wage nearer to NMW, though if you would be happy having them care for your children would be dependent on your childcare requirements, age of children, and things like how much supervision you may be giving the nanny.
The amount that employers pay to HMRC in terms of Employers National Insurance varies according to the salary being paid to the employee and according to the current rate set in the Budget. PAYE calculators like MrAnchovy’s PAYE Calculator will calculate the Employers NI amount that would be due for a given salary. These calculators can be very accurate but should not be used for payroll purposes – follow the procedures for operating payroll instead. So using the PAYE calculator as a guide tool, we can see that if we paid a nanny £1500 Gross per month, in 2012/13 tax year, Employers NI would be £121 per month.
Activity Budget – Nanny Kitty
Caring for children will often involve taking them out to various places – toddler groups, singing groups, to the library, museums, castles, trips on a train etc.
These activities and outings cost money, so you need to decide how you want to pay for those things. Do you want to reimburse each expenses individually or do you want to give a weeks budget and let your nanny decide how to spend that money on your children?
I would say that it is easier to give your nanny a set budget and let them manage that budget. £5 per day may well work quite well if you have a couple of children, a bit more may be needed during school holiday periods. A bit more may be needed if you have more children and as children get older as admission charges for under 3′s can sometimes be nil, whilst a 6 year old could be charged quite a lot.
So if you take £5 per day as a budget, you can calculate that out over a 1 year period. The amount will vary depending how many days per week your nanny works. Also you won’t need to include in the budget days your nanny is on holiday (5.6 weeks is minimum holiday entitlement in the UK).
A nanny working 4 days per week would be looking at a kitty / activities budget of £928 per year.
Payroll
Will you be doing the payroll paperwork yourself or would you want some help with that? There are various nanny payroll companies who will do a lot of the paperwork side of payroll for you and each company has varying charges. I would say that £135 per year is typical of a charge for doing payroll for a nanny who is paid monthly.
Adding all these costs together can help give you a better idea of how much employing a nanny will cost you. There are other costs that may also be involved, such as nannies travel whilst on duty, nannies food & drink whilst on duty, extra wear & tear at your home if you are comparing having a nanny to using care outside of your home such as a nursery or childminder.
Are there any costs you feel should be added in, which can be easily calculated? Or are all the other likely costs too variable to be able to give a realistic general cost?
Tonight on Channel 4 (UK) is the beginning of a new documentary series about dads and dads-to-be being involved in caring for children. They are being given a crash course in childcare by being placed in a nursery and being asked to care for the children in that nursery.
Some men may think that childcare is women’s work, others may feel they just don’t have the time to be involved in caring for their own children. Maybe men lack the caring instinct that women seem to have or is it just hidden? What really happens if men are pushed into caring for children… is it a disaster or does it work out allright in the end?
As a male nanny I’ve worked in pre-school and nurseries in the past as well as working in families homes. I am a bloke and genetically I am just like other men I would guess. However I seem more in touch with my childcare ability than some other men. Maybe it is due to being given the chance to be involved in caring for children and then finding that I actually enjoyed that role.
The Daddy Daycare documentary on Channel 4 tonight isn’t about nannying or men working in a nursery but it might be an interesting watch for anyone interested to see how men interact with young children and to see how over time some men are able to care for young children just as well as women are able to do so.
I will be interested to see how the men get on and what response they get from the nursery workers and parents of children at the nursery. Is having a man in the nursery seen as being a positive thing? I will also be interested to see what happens at the end, will those men go on to spend more time with their own children, or even take up a job in childcare.
Update:
Looking at how people have been finding this blog post about the Daddy Daycare programme on Channel 4, some people have searched for more information about the nursery featured in Episode 1. That nursery to my knowledge was Magic Roundabout at Stockwell. Map Their Ofsted report can be viewed here on the Ofsted website. There is a virtual tour of the nursery available on the Magic Roundabout website.
Episode 2 was at Carlton Hill Community Nursery, NW8. Ofsted report. Map. Nursery Website.
Episode 3 was at Tadpoles Nursery, SW10. Ofsted ReportNursery Website
What did you think of the programme? Do you feel it will encourage fathers to spend more time with their children? Do please add your comments.
In the UK we have childcare legislation that applies to Childminders, Nurseries, Pre-Schools and other forms of group childcare. Nannies however do not fall under the compulsory part of that legislation (Childcare Act 2006 plus it’s amendments).
To care for children in their [the children's], own home a nanny does not have to be registered (in England by Ofsted, in Wales by CSSIW, in Scotland by SCSWIS, in Northern Ireland by HSC) unless parents are paying using Childcare Vouchers or via Tax Credits.
Nannies should find out about registration requirements in their country as they do vary. In Scotland for example it is the childcare agency that is registered rather than the individual nanny.
Nannies are often called Home Childcarers by the childcare regulators, so when looking on their websites for further information look out for any mention of Home Childcarer.
Babies need vitamin D for growing healthy bones and teeth. Vitamin D is made by the human body when it is exposed to sunlight.
It is hard to be sure if a baby is getting enough vitamin D, so advice from the Department of Health recommends that supplements are taken by certain groups of people:
all children aged six months to five years old
all pregnant and breastfeeding women
all people aged 65 and over
people who are not exposed to much sun, such as people who cover up their skin for cultural reasons or those who are housebound or confined indoors for long periods
people with darker skins such as people of African-Caribbean and South Asian origin
Breastfed babies will get vitamin D from breastmilk, which is one reason
why it is important for pregnant and breastfeeding mums to have good vitamin D levels themselves.
Baby formula has vitamin D added to it, so formula-fed babies get their vitamin D from their milk.
Other Sources Of Vitamin D
oily fish, such as salmon and sardines
eggs
fortified fat spreads
Adults and children can get vitamin D via some types of food, such as oily fish and eggs. It is difficult to obtain enough vitamin D via diet alone, so exposure to sunlight is also important, especially in winter months when the daylight hours are shorter.
Vitamin D supplements are recommended by DoH for children aged 6 months to 5 years unless they are drinking 500ml (a pint) or more of infant formula a day.
During the winter spend time every day in sunlight – a good reason for going to the playground. A pity it rains so much in winter.
Today (Monday 23 January 2012) the nanny salary survey was published in Nursery World magazine. The survey is collated by Nannytax, a nanny payroll company which this year asked nanny agencies and nanny employers to complete an online survey – meaning that anyone could complete it. In previous years it has been collated from participating clients and nanny agencies.
In 2010 the survey was completed by 80 nanny agencies and 485 Nannytax clients. In 2011 the survey was completed by 95 nanny agencies and 1244 nanny employers.
The biggest increase in salary I notice from the wages table is that of nannies who do not work in London or the Home Counties. Those nannies who work as a live-out nanny, outside of the south east saw a rise of £1542 in their gross annual salary. In comparison live-out nannies in the home counties (including outer London) saw a drop in gross annual salary of £296 Central London nannies saw a small increase, £389 which is small in comparison to the increase experienced by nannies not in the home counties.
Home Counties: Bedfordshire, Berkshire, Buckinghamshire, Essex, Hampshire, Hertfordshire, Kent, Surrey, Sussex. May include parts of Cambridgeshire, Oxfordshire and Dorset. It is unknown what definition of Home Counties was used in compiling the survey.
Is this a sign that nannies salaries are beginning to even out across the UK, or is it just a result of the survey being completed by different people this year? Personally I feel that’s hard to know for sure, though the change from 485 clients, to 1244 nanny employers could be of significance.
Best to quote Gross rather than net, we are trying to convert nannies to speak this way.
Further into the webchat, ANA’s position regarding Gross v Net pay was clarified a bit:
All Agencies would prefer to quote gross rather than net, we need to convert the nannies. It goes back to the olden days when servents were paid cash in hand and it has never changed. It has been an area that ANA is looking into. It is always best to quote the job as a gross figure and make sure there contract is in gross too.
BAPN ( British Association of Professional Nannies) is going to launch a campaign called..Nannies “ lets talk gross ££”, encouraging all agencies and nannies to discuss salary in gross terms. As we believe this is one of the key aspects that will help raise the professional status of nannies. We do hope that ANA will show their full support and we can work together on this.
ANA did not reply to this.
I asked for further clarification, alas my message was posted after the 1pm cut-off time, though I do hope that ANA will come back and answer the question at a later date:
I said:
So is ANA going to tell all member agencies that they must not talk to nannies or parents about Net wages? Will all ANA member agencies remove Net wage figures from their websites and adverts?
So whilst ANA did say that they were trying to convert nannies, they didn’t acknowledge that it is perhaps the agencies who need the converting. From my chats with nannies on Mumsnet, NetMums and NannyJob message boards, it seems that most nannies want Gross pay and that it is agencies that talk about Net pay.
So is it the agencies or the nannies that need educating?
If agencies wanted to support Gross pay… why do they keep on advertising jobs as Net?
The survey was completed by 1244 employers and 95 nanny agencies. Of those who responded to the question, 2.4% (23 respondents) said that they either employ a male nanny, or had employed a male nanny.
As a male nanny myself, I feel this is great news as it means more parents are willing to consider a male nanny than they were 10 years ago (though I only base that on my personal view of the nanny job market, as I am not sure there was any nanny survey done 10 years ago asking about gender).
The full survey results have not yet been released but you can read a summary of the findings on the NannyTax website and Nursery World magazine are expected to shortly publish more details from the survey.
Parents: Do you/would you employ a male nanny?
Nannies: Do you know/have you met any male nannies?
Looking at the log on this blog I can see some of the questions entered into search engines which lead someone to find my blog.
Some of those search queries I have listed below, with a brief answer to the question:
How many children can a nanny look after?
The number of children a nanny can care for in the UK is limited by the nannies insurance and also by childcare legislation. Insurance can limit it to 6 children (ask your nanny about their public liability insurance). Childcare legislation limits it to caring for children from no more than two families at a time.
How much lunch does a nanny get?
Giving a quantity is very hard as every individual will have a different amount of food they need to keep their body healthy. I feel a nanny should be eating with the children in their care and setting an example to them. Therefore the nanny should where possible be eating the same as the children. The 1 year old I care for will often have exactly the same lunch as I have, or am I having the same lunch as she has? Whichever way around it is, we are both having the same, it’s just that mine isn’t cut up into small pieces.
What are nannies?
Nannies are adults who come to a families home to care for the children at that home whilst the children’s parent(s) go out to work. A nanny cares for the children and help to look after the home, so will often do some tasks around the home such as children’s laundry and preparing children’s meals. The precise duties of a nanny will vary from job to job and should be agreed between the employer (parents) and employee (nanny) in advance.
Kids going to toilet with nannies
When you work as a nanny children coming with you to the toilet is part of the job. When you are out and about with children, you can’t leave them unattended so you have to go with them – regardless of their gender. I nanny for children who are quite young, so I look for “baby changing” rooms which include a toilet. That way I can change baby, whilst pre-school child can use the loo. At the children’s home, you won’t get privacy when using the toilet.
Please do send me an e-mail if you have a suggestion for a nanny related topic you would like to see featured, or if you would like some individual advice about employing a nanny or being a nanny.
nannynick@gmail.com
