In the nanny industry net-wage agreements are surprisingly common. But a net wage agreement can have serious financial implications for both the employer and the employee.
By agreeing a net salary the employer is essentially writing a blank cheque - committing to pay ALL tax and NI contributions on behalf of their nanny, irrespective of any changes in the legislation and without taking into account her individual tax code or tax position.
The solution is to agree the salary on a gross wage basis
This protects the employer's total costs and means they will not be affected by changes in the legislation, nor will they run the risk of getting lumbered with any unpaid tax from their nanny's previous employment.
If you want to more about the total gross cost of paying your nanny's net salary, please use Tinies Payroll Calculator.
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