What are the regulations if nanny is a student?

If nanny is a student, they will still be subject to paying Tax and NIC on their salaries like normal workers if they earn above their personal allowance, which for the current tax year (19/20) is £12,500.00 gross per annum (£1,041.67 gross per month). If nanny’s earnings are below this threshold then they will not be subject to tax deductions on their salaries.

Nannies over the age of 16 will need to have Employee National Insurance deducted.

Nannies who are students and come from overseas will not be able to get a National Insurance refund if they return home, even if they work in the UK for a short period of time.

The only way a foreign student nanny could get exemption from National Insurance is to produce either an A1, E101 or E120 certificate from a European Economic Area (EEA)

If your student nanny leaves the UK to return to their native country during the tax year, they may be able to claim back some or all of the Tax which they may have paid on their salary in the UK. They would need to complete and return a form ‘P85’ to HMRC, including parts 2 and 3 of their P45 from their current employment. If nanny, has worked in the UK for a full tax year, then they will not be able to claim back the Tax which they have paid on their earnings.

The P85 form can be obtained by contacting HMRC directly.

https://www.gov.uk/tax-right-retire-abroad-return-to-uk

Childminders – How to Make Your Home Childcare-Friendly

Childminders take care of children in their own homes, so it’s important that your home is not only child-friendly and safe, but also suitable for childcare. Ensuring your home is correctly set up will make your life easier, and more enjoyable for the children in your care.

Following is a list of ideas you may like to use to help your home function as an efficient, yet still a home-from-home, childcare setting.

Toilet facilities

You may not have thought much about your toilet facilities before setting up as a childminder, but it is something that will need your attention. As a childminder, you will be looking after children of different age groups whose toileting needs may be different to one another.

Invest in a potty and a special toddler toilet seat for younger children to use whilst in your home, and have a pack of wet wipes and disposable nappies available for emergencies.
You may not wish to have a lock on the door that is accessible to small hands. Instead, provide a “do not disturb” sign that can be hung on the door whilst the toilet is in use by a child who wants privacy – and ensure that everybody knows what the sign means!
Liquid soap in a pump bottle is less messy, easier to use and more hygienic than traditional block soap.
A nice way to help children feel at home – and to help minimise the spreading of germs, particularly during this pandemic – is to provide individual hand towels for each child, or one if you can one use towel which you can wash and replace each day, hang them on a hook with their name above it. Inexpensive self-adhesive hooks can be bought from DIY shops, and sticky labels from anywhere that sells stationery.

Personal property box

Young children tend to come with a lot of extra baggage. Spare clothes, changing bags, sunblock, umbrellas and special toys may all be spending the day at your house too. When you find yourself minding three or four children, things can get pretty cluttered and crowded as you can probably imagine! Not all of us are lucky enough to live in large houses where a whole room can be dedicated to storing the children’s things, so you will need to be creative. A good way for childminders to get around this is purchasing some inexpensive plastic storage tubs and allocating one to each child you regularly care for. These can be placed in a row somewhere in the house and will help you stay organised. It will become part of the child’s routine to put any item they need to keep safe in the box, and to collect the contents of the box before leaving.

Dining cupboard

Younger children will probably require special plates, cups and cutlery to help them feed themselves. If you can, dedicating a separate cupboard to these things will make your life a lot easier when it’s lunchtime or snack time.

Overall, the most important thing to remember is to stay organised. The old saying, “a place for everything and everything in its place”, is very apt for those who are providing childcare in their homes. A little forward planning will make your life exponentially easier.

Get into the Christmas spirit with our top 5 festive books for children

Christmas is the perfect time to rekindle your child’s love of books and reading.

Children’s Christmas books are filled with happiness, wonder and strong morals. Reading is a simple, easy activity that can be enjoyed by children of all ages, no matter the weather.

Encourage them to learn by reading aloud or helping them to read along.

What are you waiting for? Pick up a book today and spark their imagination.

See below for our recommended top 5 festive children’s books!

Continue reading “Get into the Christmas spirit with our top 5 festive books for children”

30 Hours Free Childcare

The criteria for 30 hours for funded childcare, is that you must earn £131.36 a week which equates to 16 hours at the national minimum wage or Living Wage.

The 30 hours a week is for 38 weeks of the year and is for children who are aged 3 or 4 this equates to 1,140 hours per year.

You will not be able to claim this, if you or your partner has a taxable income of over £100,000, the child does not usually live with you, if the child is fostered or if you are from outside the EEA and it states you can’t access public funds on your UK residence card.

To register for funded childcare or for more questions:

https://www.childcarechoices.gov.uk/

Nanny or Au Pair

Age and Cultural exchange programme

An au pair is between the ages of 18-30 and comes to the UK to learn or perfect her English in exchange for childcare.

A nanny can be any age and does not take part in a cultural exchange programme.

Wage and working hours

Au pairs can only work on average 30 hours a week and on top of their accommodation will normally get what is classed as ‘pocket money’. ‘Pocket money’ on average is £100.00 per week and as long as they earn less than £118.00 per week and have no other income this does not need to be declared to HMRC.

A nanny receives a wage in line with the national minimum wage.

Language courses

Au pairs must have the chance to attend a language course.

A nanny does not have to attend a language course.

Employee/family

An au pair is seen as a temporary family member.

A nanny is seen as an employee.

Legalities

An au pair needs a visa specific to an au pair.

Nannies who are coming from abroad need a work visa or permit. A nanny cannot work under an au pair visa.

Live in Nannies

There has been a rise in live-in nannies, and with that confusion over nanny’s legal pay.

If nanny lives in the family home, is treated as part of the family – eating most meals with them and spending time together such as leisure activities and evening time in the same sitting room, then the national minimum wage does not apply.

The national minimum wage will come into effect for nanny’s who are not treated as part of the family, but instead the employer will be able to use the offset allowance when the nanny is live-in by £7.55 a day, £52.85 for a whole week.

The other scenario is that nanny is given accommodation separate to that of the family, this then becomes a benefit in kind and needs to be declared annually to HMRC.

If there is a benefit in kind, it will mean nanny’s tax code will be decreased and her net pay goes down and as an employer having to pay an additional national insurance on the benefit amount.

The law is very strict, so you need to make sure you know how to proceed with your live in nanny.

Understanding Tax Codes

Your tax code determines the amount of tax you pay each pay period and for current tax year the standard tax code is 1250L.

Whatever your tax code the numbers denote the amount you can earn each year before you are liable to pay tax, you just need to add a zero to the end of code and this then means the 1250 code gives you a figure of £12,500 you can earn before you pay tax.

This amount is then split into the number of pay periods you will have in the tax year, 52 if weekly and 12 if monthly.

Weekly £12500/52 = £240.38

Monthly £12500/12 = £1041.67

Once you have reached the above earnings in each pay period you then pay tax at 20%.

If you’re annual earnings are above £50,001.00 then the tax rate increases to 40% on earnings above this.

If you have several jobs it could well be that one of your employers has the full allowance (£12,500.00) and the other is using a tax code of BR, BR denotes that all earnings in that employee pay tax at 20% as the full allowance is being used elsewhere.

Should both employers have the full tax code, you will then need to contact HMRC directly (0300 200 3300) to get one of these corrected, you will need your NI number to hand when contacting them.

Payroll Terms

These are some of the most common terms used in payroll.

Gross pay – this is the pay before deductions for tax, national insurance, pension and student loans. The gross pay includes overtime, commission, bonuses, statutory payments and any other taxable income.

Net Pay – This is what nanny takes home in her pocket.

Tax – Deducted based on nanny’s tax code which determines nanny’s tax free allowance and then any earnings above the tax free allowance is deducted at 20%.

NI – National Insurance. There are 3 types of NI for PAYE.

Employees NI deducted from nanny’s gross wage at 12% on earnings above £166.00 per week.

Employer’s NI on top of nanny’s gross wage paid at 13.8% on earnings above £166.00 per week.

Class 1A NICS, this is a yearly payment for any benefits in kind nanny may have had for the previous tax year.

SMP – statutory maternity pay. Nanny is entitled to 39 paid weeks of leave providing she meets the criteria. Nanny is allowed a further 13 weeks unpaid

SPP – statutory paternity pay. Nanny entitled to 2 weeks of statutory pay.

SSP – statutory sick pay. Nanny will get SSP after 4 consecutive working days of sickness

P60 – Nanny will be given this form at the end of the tax year to show her annual pay, tax, NI and statutory payments, she then keeps this for her own records.

P45 – When nanny leaves your employment, a P45 will be issued with her leaving date, tax code, if a student loan has been deducted and total gross and tax to date in that tax year, she then gives this form to her next employer.

Qualifying Criteria for the Work Place Pension

Whether or not your nanny qualifies for the work place pension depends principally on your nanny’s age and their earnings. The new law requires every employer to automatically enrol workers into a work place pension scheme if they are aged between 22 and the State Pension Age, and earn over £10,000.00 per annum.

If nanny is automatically enrolled in a pension, they can opt-out up to 30 days after the initial set up has been completed and get a refund on the amounts which have been deducted from their salary. They must complete and return an opt-out form and inform their pension provider.

If your nanny does not qualify to be automatically enrolled they still have the right to join a work place pension. This is known as a Non-eligible job holder.

Non-eligible job holder is an employee who doesn’t have to be automatically enrolled into a work place pension, but can ask to be joined into a pension scheme if so wish. If they do, both the employer and the nanny will have to pay into the pension pot each month.

The minimum auto enrolment contribution rates are currently 8% of qualifying earnings. This is split between 3% which must be paid by the employer and 5% which must be paid by the employee.

Tax Free Childcare and Childcare Vouchers

Childcare vouchers will cease from the 5th October 2018 and thereafter the Tax-Free Childcare scheme will take over.

You can get up to £500 every 3 months (£2,000 a year) for each of your children to help with the costs of childcare.

If you get Tax-Free Childcare, the government will pay £2 for every £8 you pay your childcare provider via an online account.

https://www.gov.uk/help-with-childcare-costs/tax-free-childcare

You can get Tax-Free Childcare if you and your partner (if applicable) are –

in employment or getting parental leave, sick leave or annual leave

each earning at least the National Minimum Wage or Living Wage for 16 hours a week – this is £131.36 if you’re 25 or over

This earnings limit does not apply if you’re self-employed and started your business less than 12 months ago.

Your child must be 11 or under and usually live with you. They stop being eligible on 1 September after their 11th birthday.

Adopted children are eligible, but foster children are not.

If your child is disabled, you may get up to £4,000 a year until they’re 17. They’re eligible for this if they –

get Disability Living Allowance, Personal Independence Payment or Armed Forces Independence Payment

are registered as blind or severely sight-impaired

You’re not eligible if either you or your partner has a taxable income over £100,000.

Your childcare provider must be signed up to the scheme before you can pay them and benefit from Tax-Free Childcare.