What employee benefits can I offer my nanny?
It is not uncommon for nanny employers to offer employee benefits to their nannies, and many nanny employers choose to offer additional perks as it can contribute towards a swifter recruitment process, a better working relationship, and reduce employee turnover.
In this article, we will explore the different types of employee benefits nanny employers can offer their nannies, and how to comply with HMRC when offering these benefits.
What are employee benefits?
Employee benefits are perks offered by an employer to their employee in addition to the employee’s salary. Employers often offer additional perks in order to attract candidates and keep their employees happy.
Benefits in Kind
It is important to be aware that some employee benefits are classed as Benefits in Kind, which is a tax on certain benefits and perks offered to employees. You must report any taxable benefits you provide your employee with to HMRC, and report how much Class 1A National Insurance you owe on all the benefits you’ve provided, and pay the National Insurance due.
What employee benefits can I offer my nanny which are classed as Benefits in Kind?
Examples of employee benefits which must be reported to HMRC include:
- Accommodation, where the nanny’s accommodation is on the same grounds but they have a separate entrance/utility bills and/or the accommodation is totally separate from your property.
- Car (owned by the employer), if you provide a car for the nanny that they will use for personal use (travel to and from work is considered personal use).
- Ofsted Registration, where an employer is paying for their nanny’s Ofsted Registration
- Mobile Phone, where the contract is between the nanny and the supplier and you the employer pay the phone charges.
- Nanny Insurance
- Health Insurance
- Gym Membership
- Visas
What employee benefits can I offer my nanny that are not classed as Benefits in Kind?
Examples of employee benefits which do not need to be declared to HMRC include:
- Accommodation, if you are providing your nanny with accommodation within your home.
- Car (owned by the employer), if you are providing your nanny with a car and the nanny exclusively uses the car to carry out their duties.
- Mobile phones, where the contract is between you, the employer, and the supplier and the nanny uses the phone.
- Welfare counselling (EAP)
- Small gifts (below the value of £50)
- Parking costs if this is used solely for work
- Training where this will support the nanny’s job performance
- The Nannytax Nanny Rewards & Wellbeing Package
Please note that the above lists are not extensive and you can read further guidance on Benefits in Kind here.
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