Nanny Matters - Nanny payroll specialists

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Pensions for nannies

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 ‘staging date’, which is their deadline for putting a pension scheme in place. Most small employers have staging dates in 2016 or 2017. If you are just about to take on your first nanny, you won't be affected by the legislation until the end of 2017 at the earliest.

Nannies who earn more than £10,000 pa must be enrolled in a pension scheme automatically. Those earning less than £10,000 pa can request a pension scheme if they want one. 

What You Get

How much will a pension cost?

Pension contribution amounts are relatively small, but you need to plan ahead.

Pension contributions are calculated as a percentage of earnings, with nothing at all payable on the first £112 per week.  The employer’s contribution is calculated at 1% of the remainder, and that will gradually increase to 3% from April 2019 onwards.

The nanny also contributes, starting at 1% and increasing to 5% in April 2019.

The amounts are relatively small, so the cost to employers is minimal (much less than, say, an annual pay rise). We make sure our clients know exactly what to expect. 

Chosing a payrol service

Our pension services

Freedom to choose

NannyMatters have developed a combined payroll and pension service that takes care of all aspects of the new 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
  • Managing monthly payments to the pension company

...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.  

Chosing a payrol service

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.  

 

Chosing a payrol service