How to calculate your nanny’s monthly pay

Finding the right payment method for your new nanny is not as complicated as it sounds and there is a solution for all employment types, whether you have a full time, part time, zero hours or term-time only nanny.

Annual Salary

The most common payment method is based on an annual salary, looking at the whole earnings for the year and paying 1/12th of that salary each month. This is preferable as it provides a regular income for your nanny so they can budget for their own household bills and living costs each month. Changes can be reported to us each month if necessary for extra hours, expenses or unpaid leave. However, if your nanny’s hours vary according to term-time or for other reasons like your own changing schedule, then you might consider a different method.

By Schedule

Paying against a schedule is very common for nannies working term-time only or variable term-time hours and when the hours are known in advance. This allows us to draw up a schedule in advance, including holiday pay, but gives flexibility for changes if needed.

Actual Hours

If the hours vary and you don’t know them in advance then you can report actual hours to us each month, providing maximum flexibility. Holiday pay can then either be added when the nanny goes on holiday (reported by you) or paid at regular intervals. The administration of this method is key and you will need to be strict with deadlines to avoid incurring late filing penalties with HMRC.

Core Salary with regular extra hours

Finally, if the hours will vary a lot but you know there is a minimum amount your nanny will work each month, then you can arrange to pay a core salary to ensure a payslip is raised on time each month and any additional hours can be added to payslips as you go.

For each method there are pros and cons and the NannyMatters Team are always available to talk these through with you and come up with a custom fit.