Nursery World - Editor's view (79)

The continuing refusal of the Government to contemplate registering nannies or allowing parents tax credits for employing them is leading to a boom in schemes that set nannies up as limited companies in order to cut costs (see News, page 6). Some schemes around involve the parents making the savings in tax and National Insurance, while the nanny is at risk of missing out on benefits and may not have any savings passed on to her. The two schemes we report on this week promise to avoid these pitfalls by giving the nanny control of the situation, and both come with endorsement or involvement from reputable quarters, including the Professional Association of Nursery Nurses.

Some schemes around involve the parents making the savings in tax and National Insurance, while the nanny is at risk of missing out on benefits and may not have any savings passed on to her. The two schemes we report on this week promise to avoid these pitfalls by giving the nanny control of the situation, and both come with endorsement or involvement from reputable quarters, including the Professional Association of Nursery Nurses.

However, there must be a danger that some nannies will be pressured into arrangements that will not suit them under schemes that offer them no protection of employment rights. And how long will it be before the tax loophole is closed by the Inland Revenue? Surely it would be better to make employing a nanny a more affordable option by registering this form of childcare and allowing parents to claim tax credits.

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