It is your responsibility as an employer to register and pay NI and income tax on behalf of your nanny if their pay exceeds £109 per week.
An employer must also register if their nanny has another job, even if they are paid below the threshold.
- If you pay over £109 a week you must register with the HMRC as an employer.
- If you pay between £109 and £148 per week, no tax and NI will be due.
- If you pay between £148 and £182 per week, NI contributions are due.
- If you pay over £182 per week, income tax and NI contributions are due.
As of April 2013, the HMRC requires every employer to calculate the NI and income tax of their employee, and submit this online at the same time that the employee gets paid (real time information / RTI). If your nanny gets paid every Friday, you have to submit your tax calculation to HMRC every Friday. If you don’t, you can be fined. Even if a nanny is on unpaid leave or on maternity or sick leave, or you employ a nanny temporarily, HMRC will need to be informed.
To calculate approximate NI and income tax costs follow this tax calculator link.
We suggest that if you are in doubt about your responsibilities, that you contact a specialist payroll agency. See our recommendations below.
Please note: information and rates may change over time, for current information please contact the HMRC or a specialist payroll agency.