The cost of employing a nanny or housekeeper.

You should be aware that when you recruit a Nanny you become an employer and must register with the Inland Revenue, immediately. We can refer you to an organisation that will do this for you and provide a payroll service, for an annual fee. To see the total cost of employing a nanny please see below.

The National Minimum wage applies to nannies as any other occupation but it does not apply to employees aged under 18 or to nannies living as part of the family household, where there is no separately metered accommodation. NOTE - the net figures apply to a nanny with one job and one wage in a week - Nanny shares and Child photo

Nanny with two positions have a greater tax and NI liability.

As in most occupations the best nannies command rates higher than the minimum legal wage. The current market rate for an experienced full time nanny is between £7.00 and £9.00 net per hour net. We are able to provide advice and guidance on how to arrange payment for your nanny.

Weekly salaries in this region on average are between £260 - £450 net dependant on duties, experience, hours and age. Click here for information on Nanny salary expectations.

Net Pay to Gross Pay Conversion (2007-8)
Weekly						Monthly Equivalent						Annual
Net Pay	Tax	NI	Gross Pay	Emp Nat Ins	Total Cost	Net Pay	Tax	NI	Gross Pay	Emp Nat Ins	Total Cost	Annual Salary
£100	£0	£0	£100	£0	£100	£433	£0	£0	£433	£0	£433	£5,200
£110	£1	£1	£112	£2	£114	£477	£5	£6	£488	£7	£495	£5,852
£120	£2	£3	£125	£3	£128	£520	£11	£12	£543	£14	£557	£6,509
£130	£4	£4	£138	£5	£143	£563	£16	£18	£597	£21	£618	£7,167
£140	£6	£6	£152	£7	£159	£607	£27	£25	£659	£29	£688	£7,893
£150	£9	£7	£166	£9	£175	£650	£41	£32	£723	£37	£760	£8,666
£160	£12	£9	£181	£10	£191	£693	£55	£39	£787	£45	£832	£9,440
£170	£16	£11	£197	£12	£209	£737	£69	£46	£852	£53	£905	£10,221
£180	£19	£12	£211	£14	£225	£780	£83	£53	£916	£62	£978	£10,995
£190	£22	£14	£226	£16	£242	£823	£97	£60	£980	£70	£1,050	£11,768
£200	£26	£16	£242	£18	£260	£867	£112	£67	£1,046	£78	£1,124	£12,549
£210	£29	£17	£256	£20	£276	£910	£126	£74	£1,110	£86	£1,196	£13,323
£220	£32	£19	£271	£22	£293	£953	£140	£81	£1,174	£95	£1,269	£14,097
£230	£36	£20	£286	£24	£310	£997	£155	£89	£1,241	£103	£1,344	£14,878
£240	£39	£22	£301	£26	£327	£1,040	£169	£96	£1,305	£111	£1,416	£15,651
£250	£42	£24	£316	£28	£344	£1,083	£183	£103	£1,369	£119	£1,488	£16,425
£260	£45	£25	£330	£30	£360	£1,127	£197	£110	£1,434	£128	£1,562	£17,206
£270	£49	£27	£346	£31	£377	£1,170	£211	£117	£1,498	£136	£1,634	£17,979
£280	£52	£29	£361	£33	£394	£1,213	£225	£124	£1,562	£144	£1,706	£18,753
£290	£55	£30	£375	£35	£410	£1,257	£240	£131	£1,628	£153	£1,781	£19,534
£300	£58	£32	£390	£37	£427	£1,300	£254	£138	£1,692	£161	£1,853	£20,308
£310	£62	£34	£406	£39	£445	£1,343	£268	£145	£1,756	£169	£1,925	£21,081
£320	£65	£35	£420	£41	£461	£1,387	£283	£153	£1,823	£178	£2,001	£21,862
£330	£68	£37	£435	£43	£478	£1,430	£297	£160	£1,887	£186	£2,073	£22,636
£340	£72	£39	£451	£45	£496	£1,473	£311	£167	£1,951	£194	£2,145	£23,410
£350	£75	£40	£465	£47	£512	£1,517	£325	£174	£2,016	£202	£2,218	£24,191
£360	£78	£42	£480	£49	£529	£1,560	£339	£181	£2,080	£211	£2,291	£24,964
£370	£82	£43	£495	£51	£546	£1,603	£353	£188	£2,144	£219	£2,363	£25,738
£380	£85	£45	£510	£52	£562	£1,647	£368	£195	£2,210	£227	£2,437	£26,519
£390	£88	£47	£525	£54	£579	£1,690	£382	£202	£2,274	£235	£2,509	£27,293
£400	£91	£48	£539	£56	£595	£1,733	£396	£209	£2,338	£244	£2,582	£28,066
£410	£95	£50	£555	£58	£613	£1,777	£411	£217	£2,405	£252	£2,657	£28,847
£420	£98	£52	£570	£60	£630	£1,820	£425	£224	£2,469	£260	£2,729	£29,621
£430	£101	£53	£584	£62	£646	£1,863	£439	£231	£2,533	£268	£2,801	£30,394
£440	£104	£55	£599	£64	£663	£1,907	£453	£238	£2,598	£277	£2,875	£31,175
£450	£108	£57	£615	£66	£681	£1,950	£467	£245	£2,662	£285	£2,947	£31,949
£460	£111	£58	£629	£68	£697	£1,993	£481	£252	£2,726	£293	£3,019	£32,723
£470	£114	£60	£644	£70	£714	£2,037	£496	£259	£2,792	£302	£3,094	£33,504
£480	£118	£62	£660	£72	£732	£2,080	£510	£266	£2,856	£310	£3,166	£34,277
£490	£121	£63	£674	£73	£747	£2,123	£524	£272	£2,919	£318	£3,237	£35,026
£500	£124	£63	£687	£75	£762	£2,167	£536	£272	£2,975	£325	£3,300	£35,703
£510	£126	£63	£699	£77	£776	£2,210	£549	£273	£3,032	£332	£3,364	£36,377
£520	£129	£63	£712	£78	£790	£2,253	£561	£273	£3,087	£340	£3,427	£37,052
£530	£132	£63	£725	£80	£805	£2,297	£573	£274	£3,144	£347	£3,491	£37,729
£540	£135	£63	£738	£82	£820	£2,340	£586	£275	£3,201	£354	£3,555	£38,404
£550	£138	£64	£752	£83	£835	£2,383	£589	£275	£3,247	£361	£3,608	£38,970

Salary Source information PAYE for Nannies

This is payable by all employers, broadly, if the employee becomes pregnant whilst working for the employer and provided they are paid at least £87 per week. SMP is taxable and is paid at 90% of the normal GROSS wage for the first six weeks of maternity leave and then at a flat rate of £112.75 (or 90% of the normal gross wage, if lower) for a further 33 weeks. In most cases, the employer can reclaim all of the SMP paid from the HM Revenue and Customs (HMRC). A further period of unpaid leave may be taken up to 12 months Maternity Leave in total.

This is payable as a minimum by all employers if the employee is sick for at least 4 working days in a row. The rules concerning eligibility and payment are very complicated but if SSP is payable, it is paid at a rate of £72.55 per week. The employer may be able to reclaim a proportion of the SSP paid from HMRC, but again the rules are complicated. For lengthy periods of illness (several weeks), the employer is likely to be able to reclaim a higher proportion of SSP paid. If the employer pays more than basic SSP during illness, the basic SSP element may be reclaimed in some circumstances. SSP is payable for up to 28 weeks of illness.

This is very unfair to a second employer who has agreed to pay the nanny a net wage and results in a very high Income Tax charge. However, for an employer using our payroll service, in most cases we will be able to arrange with HMRC for the nanny’s tax allowances to be shared in proportion to the hours she works in each employment. This will reduce the costs for the second employer, but put up costs for the first employer. The nanny’s pay (if she has agreed a net wage with both employers) will stay exactly the same.

The information above is provided only as a general guide. PAYE for Nannies Ltd advises clients to check all information and accepts no liability for any errors or inaccuracy.

Salary Calculator - Tax and Insurance and the total cost of employing a nanny/housekeeper (Tax year 2008/2009)