It is becoming increasing popular for two or more families to employ the same nanny to either care for all children at the same time, or split the week between them. This approach makes nannies affordable and more accessible for many families, for whom it could not be an option if employing alone. It isn't necessary for the families to know each other, although good communication between them will make the arrangement much easier.
Sharing a nanny is easy with Nannytax
We deal with nannyshares daily and have a dedicated and experienced nannyshare team who can navigate the complexities of splitting costs and making sure each family pays the correct liabilities to HMRC.
The infamous 'Tax Code Split'
This is where the nanny's tax free allowance is split proportionately between her employers, to avoid either employer paying basic rate tax on all of the nanny's earnings from them. As long as both employers agree a gross salary with the nanny a tax code split is not really necessary as their Total Costs will be protected. Together both employers will be paying the correct amount of tax overall on the nanny's behalf. However, some nannyshare clients like to split the nanny's tax code so the allowance is fair and we are happy to do this if it is preferred. It is a straightforward exercise but we do need the nanny's written permission before we can proceed.
A Tax Code Split is more beneficial to clients who have agreed the nanny's salary in net terms. Clients are advised to contact us for guidance if this applies.
Additional things to think about
Each family should have a separate contract with the nanny so that they can continue the relationship should the other family drop out. Nannytax HR can ensure you have the right contract in place, help with any negotiations and provide a Nannyshare Agreement between you and the family you are sharing the nanny with. See Contracts of Employment and HR Support from Nannytax HR.
Talk to the other family and the nanny about holidays — a common solution is for each family to decide on one week and the nanny to decide on two weeks. See Holiday Entitlement in Useful Info for guidance on calculating holidays.
Rules and Standards
If the children of two or more families are being cared for at the same time, rules and standards will have to be agreed between the families and the nanny up front. It is worth having a Nannyshare Agreement to address this.