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What are Benefits in Kind?Benefits in Kind blog image

As a nanny employer, if you offer additional benefits or ‘perks’ for your nanny, you will need to report these to Nannytax so we can report them to HMRC. As part of your nanny’s total earnings as they will be taxable.

What is considered a Benefit in Kind?

Below is a list of the most common benefits our nannies receive (although if you’ve been providing your nanny with a benefit not mentioned below, please do contact us to confirm if this needs to be declared):
Most Common Nanny ‘Benefits in Kind’:

• Car for personal use*
• Nanny Public Liability Insurance
• Medical Insurance
• Accommodation*
• Interest Free Loans

*A car is not a taxable benefit if your nanny only uses it during working hours (such as doing school pick-ups and drop offs). If your nanny is allowed to use the car out of working hours - to drive to work for example - then it is considered a Benefit in Kind and will need to be reported to HMRC.
*If the accommodation you have provided for the nanny has a separate front door and separate metering for gas, water and electricity, it is considered a taxable benefit and will need to be reported as a Benefit in Kind.

Who pays the tax for Benefits in Kind?

As long as a Gross Wage has been agreed then tax is deducted from the nanny’s salary.
As well as tax there will also be a Class 1A National Insurance charge to the employer.

How do I report my nanny’s Benefits in Kind?

Via a P11D form. To make the reporting process easier and to ensure our clients are meeting their employer duties, Nannytax completes the PD11 form and submit to HMRC on our clients’ behalf. If you are a Nannytax client, simply email the details of any benefits to us This email address is being protected from spambots. You need JavaScript enabled to view it. and we’ll take care of the rest for you! If you don’t have a Nannytax subscription, then visit the HMRC website for further instructions on completing and submitting your PD11.