Choosing the best method to pay your Nanny can be challenging. Not only do you want to do what is best for you and your Nanny, you must also consider how you’re going to stay on top of it. How will you pay them? Will you provide payment once a week? Twice a month? Once a month? Then there’s Superannuation, Insurance and other legal requirements! These are the sort of questions you should be asking yourself to determine whether or not you are able to self-manage your Nanny’s payroll. If you’re unsure about managing your nanny’s payroll yourself, there is always the option of outsourcing the payroll process and responsibilities.
We’ve outlined the three most popular payroll options available when it comes to hiring a permanent Nanny.
Yes, you can handle the Nanny payroll process on your own but you need to understand your obligations as an employer. These include providing your Nanny with an employment contract and meeting other legislative requirements. In addition to a minimum wage, you will also need to make arrangements for regular superannuation payments, as well as organising worker’s compensation insurance and ‘pay as you go’ tax instalments.
Self-managing is a viable option if you have time, are familiar with payroll basics and are confident you can keep up with changing legislation.
Cash in hand
It is not uncommon for your Nanny to ask for cash in hand and often it seems like the “easy” option.
But did you know it is illegal under Australian law to employ a Nanny on a cash-in-hand basis? If you’re considering doing it on the hush-hush we would highly recommend you think again! Not only does it deprive a Nanny of their rights but it also leaves you wide open for other issues such as a lack of liability insurance should an injury occur or lack of legal recourse if terms of the employment contract are broken.
Over time the process of self-managing can get very complicated and time consuming which is why many parents prefer to outsource to an agency who can handle it for them.
Outsourcing takes the stress and time pressure out of paying your permanent Nanny. This is by far the most hassle-free option as the agency can handle all aspects of recruiting a suitable Nanny along with all the ongoing paperwork such as contracts, employment forms etc. It is also the most reliable – you know all your obligations are being met, and you are not liable for any nasty surprises.
At Little Lovelies we offer an outsourced payroll solution to families that have placed a Nanny using our service, OR, who have hired their own Nanny and are struggling to maintain the responsibilities associated with paying their nanny.
Our payroll service includes:
- Legally on boarding your Nanny, including lodging a TFN declaration form;
- Calculation and payment of wages – be it weekly, fortnightly or monthly;
- PAYG tax and superannuation calculations;
- Accounting for accrued annual leave, sick leave, allowances and deductions;
- Issue of payslips that meet legislative requirements;
- Quarterly calculation and remittance to the ATO of PAYG Withholding Tax and superannuation to the nominated Super Funds;
- Workers compensation insurance management;
- Employment contracts and contract term negotiation;
- Issue end of year Payment Summary to the Nanny;
- Annual Payment Summaries issued at the end of the financial year to the ATO.
Plus, we can even arrange a replacement Nanny should your Nanny be sick or go on holiday.
When it comes to looking after the person that is in charge of your most precious children, it pays to keep everything above board, to protect everyone involved, and to establish and maintain a mutually beneficial relationship.
If you would like to discuss our payroll service or are looking to find the perfect Nanny for your family contact us by clicking here, or by calling 1800 665 215.