Nanny Tax & Nanny National Insurance

As soon as an employer pays the minimum wage or above to a nanny they must, by law, organise the nanny’s income tax and National Insurance.

A nanny employer must pay the State’s National Insurance Contributions (NICs) if the nanny is to be eligible for maternity and unemployment pay.  Her employer, by law, must deduct this from the nanny’s gross pay each week.

The nanny employer also has to contribute to his/her employee’s total National Insurance payment.  (S)he pays a bit less than whatever National Insurance Contribution nanny has to pay.

It is important to understand the difference between ‘gross’ and ‘net’ pay.  ‘Gross’ is before tax and NICs deduction and ‘net’ is after the deduction.  In the nanny world there is a tendency to talk ‘net’ salaries. But this can be rather deceptive as most other jobs talk in terms of ‘gross’ pay.  Just make sure that you know exactly what your take home is and are aware of everything that is deducted and why.

Remember, this is a REAL job and should be treated as business-like as possible.   If you’re unsure about anything to do with nanny tax or nanny national insurance, don’t hesitate to ask your nanny agency, because nanny tax can be complicated and your agency will have someone specialising in this.

Click here for details on recommended nanny agencies in your area. All our recommended nanny agencies have confirmed that they conform to our  strict nanny welfare and child welfare Code of Practise.

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