Nanny PAYE Employer Cost Calculator 2025/26
Calculate the true employer cost of hiring a nanny in the UK — including gross salary, employer National Insurance at 13.8%, pension auto-enrolment contributions and Nannytax payroll service fees. Employing a nanny makes you their employer, so PAYE registration with HMRC is mandatory from day one.
Key Inputs
- Nanny gross salary — per week or per year
- Employment type: full-time or part-time
- Pension auto-enrolment: enrolled or not enrolled
- Tax-Free Childcare: using or not using the government scheme
What You'll Get
- Employer NI at 13.8% on earnings above the secondary threshold (£9,100/year in 2025/26)
- Employer pension contribution — minimum 3% of qualifying earnings (£6,240–£50,270 band)
- Nannytax or payroll service fee estimate (£250–£400/year)
- Total annual employer cost including all obligations
Important Notes — 2025/26 Rates & Caveats
Employing a nanny makes you their employer — you must register as an employer with HMRC, operate PAYE, deduct Income Tax and employee NI, pay employer NI at 13.8% on earnings above the secondary threshold (£9,100 in 2025/26), and auto-enrol the nanny in a workplace pension if they are aged 22 to State Pension age and earn more than £10,000/year. Many parents use managed payroll services such as Nannytax, Nannypaye or Poppins Payroll (typically £250–£400/year). NannyShare arrangements — where two families share a nanny — can reduce the cost by 30–50%.
Frequently Asked Questions
What employer NI do I pay for a nanny?
Employer National Insurance is charged at 13.8% on the nanny's earnings above the secondary threshold — £9,100 per year (or £175 per week) in 2025/26. For example, if a nanny earns £30,000 gross per year, employer NI = 13.8% × (£30,000 − £9,100) = 13.8% × £20,900 = £2,884/year. You do not pay employer NI on earnings below the secondary threshold.
Do I have to auto-enrol my nanny into a pension?
Yes, if the nanny is aged 22 to State Pension age and earns more than £10,000 per year (the auto-enrolment earnings trigger for 2025/26). You must enrol them into a qualifying workplace pension scheme and contribute a minimum of 3% of their qualifying earnings (the band between £6,240 and £50,270 in 2025/26). The nanny contributes a minimum of 5% (with tax relief). If the nanny earns below £10,000 but above £6,240, they can opt in and you must then contribute.
What is the Tax-Free Childcare saving for nanny costs?
Tax-Free Childcare allows you to save 20% on registered childcare costs — the government adds £2 for every £8 you deposit into your online childcare account, up to £500 per quarter (£2,000/year) per child under 12. To use Tax-Free Childcare for a nanny, the nanny must be registered with Ofsted as a nanny agency or as a childcare provider. Many nannies are not individually Ofsted-registered, so check eligibility first. A nanny agency registration costs around £100-200 and covers all nannies working through the agency.
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