Autumn Budget 2026 – Key Updates for Nanny Employers
Written by Laura Eason, Head of Customer & Operations
Estimated reading time: 3 minutes
The 2026 Autumn Budget was announced by the Government on the 28th October, and changes are being made which will impact nanny employers.
Here are the key updates you need to be aware of:
1. Increase to the National Living Wage and National Minimum Wage
From April 2027, the National Living Wage will increase by 3.93%, from £12.71 per hour to £13.21 per hour.
If your nanny is living with you and you are operating the accommodation allowance, the accommodation offset rate will be increasing by 3.87%, from £11.10 to £11.53
As a nanny employer, you must ensure you pay your nanny in line with the latest National Living Wage and National Minimum Wage rates.
2. No change to Income Tax and National Insurance Rates
There will be no increase to the rates for Income Tax or National Insurance Contributions.
3. Increase to Tax-Free Mileage Allowances
The Government has confirmed from 6th April 2026, the tax-free mileage rates for employees using their own cars or vans for business travel is 55p per mile for the first 10,000 business miles per year.
From the 6th April 2027, for any business miles above 10,000, the mileage rate will increase from 25p to 35p per mile.
Please note, the approved mileage rates are tax-free limits for qualifying payments, not a requirement for employers to reimburse every employee at those rates.
4. Immigration Sponsorship Costs & Benefits in Kind
From 28th October 2026, the following payments made by employers will no longer be treated as a taxable Benefit in Kind:
- Immigration Skills Charge
- Certificate of Sponsorship fee
As a nanny employer, if this is applicable to you, you should review how you currently record these costs and whether they have been included in your employee taxable benefits calculations.
