Nanny Pensions UK
Simple Nanny Pension Solutions For UK Nannies
Nanny pensions auto enrolment
The UK Government introduced legislation in 2010 to encourage all workers to save for retirement. The legislation is commonly referred to as ‘auto-enrolment’, because it forces employers to automatically put their employees into a pension scheme.
Domestic staff are included, and employers cannot offer incentives or otherwise encourage employees to opt out.
All employers have a ‘duty start date’ from the date their first employee starts and have up to 3 months to assess their employees and enrol them if necessary.
Nannies over the age of 22 who earn more than £10,000 pa must be enrolled in a pension scheme automatically. Those under 22 or earning less than £10,000 pa can request a pension if they want one.
How much will a pension cost?
Pension contributions have been increasing and the amounts are now quite significant so you need to plan ahead.
Pension contributions are calculated as a percentage of earnings, with nothing at all payable on the first £120 per week, or £520 per month. The employer’s contribution is calculated at 3% of the remainder,
The nanny also contributes, at 5%, but benefits from tax relief so the deduction from pay is only 4%. The tax relief is paid by the government directly to the nanny’s pension pot if it is a relief at source scheme like NEST.
The contribution amounts have been increasing since the introduction of auto-enrolment and can now be a significant cost to both the employer and employee. We make sure our clients know exactly what to expect by giving illustrations of all the costs involved.
Our pension services
Freedom to choose
NannyMatters have developed a combined payroll and pension service that takes care of all aspects of the legislation, including those all-important employee communications.
For £60 pa we will:
- Set up the pension scheme with NEST
- Manage the statutory employee communications, at the outset and ongoing
- Calculate and administer the weekly or monthly deductions from pay
- Manage the payments to the pension company
- Submit the required declarations to The Pensions Regulator
…but you don’t have to go down that route if you don’t want to. Unlike other nanny payroll companies, with NannyMatters, you are free to choose whatever pension scheme you want. If you decide to set things up yourself, we’ll carry out all the calculations and make the payslip adjustments at no charge at all.
What if I've agreed a net pay rate?
We will help our customers do the right thing
If you have fixed your nanny’s net pay, then you could find yourself having to meet the cost of both pension contributions, instead of just the employer’s contribution, and that has the potential to cost much, much more.
You may be able to avoid this trap by agreeing an equivalent gross pay rate at the outset instead. If you have already committed to a net rate, all is not lost. We’ll explain your options and guide you through.
Thinking of self-employment?
If you are working as an employee then you have full employment rights.
Some parents will, understandably, try to avoid their responsibilities by treating you as self-employed. In doing so, they are defrauding HMRC of Employer’s National Insurance contributions, as well as denying your employment rights. In almost all cases, treating a nanny as self-employed is not an option.
If you are concerned, put your employer in touch with us. We will give them free, confidential advice to help them get it right.
Get in touch with us
Office and New Enquiries
(Monday to Friday 9am to 5pm)
(Allow next working day for a response)
West End House
Blackfriars Road
Nailsea
Bristol
BS48 4DJ
