Your Obligations when Employing a Permanent Nanny

Parent Information

If you engage a Permanent Daisycare Nanny You will become the Employer.
Employing a nanny may prove to be a more sensible and convenient option for childcare for your family. Some of our nannies do have their own ABN Number and may want to look after their own tax and super obligations however you may need to take over these responsibilities as an employer there are some obligations that need to be met.

Taxation

You are required by law to register with the Australian Taxation Office and to enter the PAYG system to withhold tax from your nanny or home carers wage.

  1. Call the ATO business line on PH: 132866 or go to www.ato.gov.au (for businesses),
  2. Register for PAYG withholding,
  3. Apply for registration online or have the forms sent to you,
  4. Your employee needs to complete a Tax File Number Declaration form,
  5. Calculate the amount of tax to be withheld using the Withholding Tax Table (supplied by the tax office),
  6. Complete an activity statement quarterly and send the amount withheld to the ATO,
  7. Provide your employee with a PAYG Payment Summary – Individual Non Business, by July 14 each year.

According to the Australian Taxation Office:

“Under Pay As You Go (PAYG) withholding, you may be required to withhold amounts from payments you make to your household employees, such as nannies or housekeepers. The amounts withheld are sent to the Australian Taxation Office (ATO);

You will need to withhold amounts where you make a payment of salary or wages to an employee. If you are not sure whether your worker is an employee or contractor refer to Taxation Ruling 2000/14 or the brochure Status of the worker.”

Car Allowance

If a car is provided for the use of the nanny, it is the employer’s responsibility to provide full insurance coverage. If the nanny is to use her own vehicle as a condition of employment, an allowance of approximately $0.55 per kilometre for petrol and running costs applies over and above the agreed wage. Please note that the type of vehicle the nanny drives determines the exact kilometre rate. These rates are available from the NRMA and the Australian Taxation Office.

Superannuation

According to the ATO, “You don’t have to make superannuation contributions for some employees. These include employees who are:

  • paid less than $450 in a calendar month
  • aged 70 years of age and over;
  • under 18 years of age and working not more than 30 hours a week
  • covered by a Bilateral Superannuation Agreement
  • performing work of a domestic or private nature for not more than 30 hours a week e.g. part-time nanny or housekeeper for a non-business employer.”

In all other cases, you must make superannuation contributions on behalf of your employee. For further information on your obligations as an employer of household workers go to Superannuation Obligations – Household Employees.

Workcover

Household worker insurance is indispensable if you engage people to be employed in your home. You are required by law to provide Worker’s Compensation for your employee whilst working for you in your home. This is not always covered by your Home and Contents Insurance so you will need to check with your insurance company.

All insurance companies vary in price, but expect to pay between $17 to $60 per annum. Each state has different regulations regarding work cover so please inquire with your state’s Workcover body first.
NSW www.workcover.nsw.gov.au
ACT www.workcover.act.gov.au
QLD www.workcover.qld.gov.au
VIC www.workcover.vic.gov.au
SA www.workcover.com
TAS www.workcover.tas.gov.au

Please visit our Related Links page for more information.

Occupational Health and Safety

It is essential that you provide a safe working environment for the nanny to work in and that your home adheres to all occupational health and safety requirements.

Health and safety rules and tips checklist:

  • Establish a safety policy, and provide protective gear and equipment.
  • Enforce universal precautions and use of safety equipment.
  • Injuries happen. Consider workers’ compensation insurance coverage even if it is not mandated by the state or locality.
  • Conduct a home safety check to ensure a safe household and healthy work environment.
  • Check with an auto insurance company if your employee is going to be driving your dependents.
  • Establish a safety policy, and provide protective gear and equipment.
  • Call an insurance agent or the state insurance department for the contact information for your area’s workers’ compensation administration.

Nanny Insurance

We advise that your nanny take out Nanny Insurance. Nanny insurance is a public liability insurance to protect you should your nanny have an accident with your child/children. It covers medical procedures and special care that is not covered under Medicare or Private Health Insurance. It also covers loss of wages and compensation. We advise that you make this an essential part of your job description. We know that no amount of money will ever make up for the fact if a child has an accident, however you will have peace of mind if you have no financial worries. Please don’t ignore this insurance. We recommend Nanny Sure (www.nannysure.com.au). As this policy is approx $300 – $400 per year we would recommend that you offer to pay for this prior to your position commencing and deduct an amount per week from the nannies wages until you have been reimbursed.

Contract Agreement

We highly recommend a contract agreement which highlights both parties’ expectations of the following:

  • weekly or hourly pay rate, car allowance if applicable,
  • tax, superannuation and work cover insurance,
  • days, hours of work – start and finish times,
  • specific duties and any additional duties,
  • overtime rates for working outside set time,
  • annual recreation leave, sick leave, special leave, pay on public holidays etc.,
  • conditions of salary review,
  • conditions of termination.

You will be required to submit a copy of your agreement to Daisycare Nanny Agency™ for records of employment.

Contact Daisycare

By Email: Send message
Office Hours:
Monday to Friday 9am-5pm out of hours please leave your detailed message and we will return as soon as possible.
Saturday 10am – 1pm
Sunday & public holidays – Emergency bookings only
Po Box 2118
Bomaderry NSW 2541
Please call the office  on 1300 662 072 for all your Child Care Needs. Emergency Booking call 0412 138 755