Nanny Share in the UK: What It Is and How It Works

A nanny share is when two families employ the same nanny. This can mean the nanny looks after all the children together (shared care) or splits their time between the two homes (split care). While it's a fantastic way to reduce costs, it's crucial to know that both families are separate employers. This means each family must have its own contract, run its own PAYE payroll, and get employer's liability insurance.

A nanny share is an increasingly popular way for UK families to get the benefits of a personal nanny—flexibility, in-home care, and one-on-one attention—but at a significantly reduced cost.

But how does it actually work? And what are the legal responsibilities?

It’s a brilliant setup, but it’s more complex than simply splitting a salary down the middle. Understanding your role as an employer is the key to making it a success. Here’s everything you need to know.

What Is a Nanny Share?

There are two main ways a nanny share can work:

1. Shared Care: This is the most common setup. Two families (often living near each other) hire one nanny to care for all their children at the same time. The care usually takes place in one family’s home, or it might alternate between the two houses weekly.‍
2. Split Care: This is where the nanny splits their week between two families. For example, they might work for Family A on Mondays and Tuesdays, and for Family B on Wednesdays, Thursdays, and Fridays. The children are not cared for at the same time.

From a legal and payroll perspective, both of these scenarios are treated in the same way.

The Most Important Rule: You Are Separate Employers

This is the single most important fact to understand. A nanny share is not a joint employment.

Even if you team up with another family, you are not one "super-employer." HMRC considers you two separate, independent employers who just happen to employ the same person.

Because you are a separate employer, you each have your own legal duties.

Your Legal Responsibilities in a Nanny Share

As a separate employer, each family must do the following:

1. Register as an Employer with HMRC

You cannot have a joint PAYE scheme. Each family must register with HMRC as an employer and will receive their own unique PAYE reference number.

2. Run a Separate PAYE Payroll

Each family is responsible for paying the nanny and managing their own payroll. This involves:

• Calculating and paying the nanny's salary.
• Deducting the correct Income Tax and National Insurance.
• Paying Employer's National Insurance.
• Providing the nanny with a separate payslip from each family.

3. Provide a Separate Employment Contract

Each family must provide the nanny with their own, separate contract of employment. The contract should clearly state the gross salary you are paying, the hours, place of work, and all other standard terms.

4. Get Employer's Liability Insurance

This is a legal requirement for all employers. Each family must have their own employer's liability insurance policy in place before the nanny starts.

5. Manage Pensions

You must each assess your nanny for pension auto-enrolment. The earnings threshold (currently £10,000 per year) applies to each job separately.

For example, if you pay your nanny £15,000 and the other family pays £15,000, she will be eligible for two separate pensions—and each family must set one up.

If, however, you each pay her £9,000 (total £18,000), she falls below the threshold for auto-enrolment with both employers and would not be automatically enrolled (though she has the right to "opt in").

How to Handle Pay, Tax, and Salary

This is where nanny shares get complicated, but it’s simple if you follow one rule: always agree on a gross salary.

• Don't Split a Salary: You aren't taking a nanny's normal £30,000 salary and splitting it £15,000 each. Nanny shares involve more work (more children, two sets of bosses), so nannies are paid a higher hourly rate. Typically, each family pays around 60-70% of the nanny's standard sole-charge rate.
• The Tax Code Problem: Your nanny only has one personal tax-free allowance. This will be applied to one of her jobs (Family A). Her job with the other family (Family B) will be taxed at the basic rate on every pound she earns (a BR tax code).
• Why Gross Pay Fixes This: If you both agree on a gross salary (e.g., £15,000 gross per year each), this problem disappears. Each family's payroll will correctly calculate the tax due. Family A's payroll will show a high take-home pay, and Family B's will show a lower one. But the nanny's total net pay will be correct, and your cost as an employer is fixed and predictable.

Read: Net vs Gross Pay for Nannies: Why It's Crucial for Employers

What About Holidays, Sickness, and Contracts?

• Holiday Pay: Your nanny is entitled to 5.6 weeks of paid holiday from each employer. For example, if she works 2 days a week for you, she gets 5.6 x 2 = 11.2 days of holiday from you. The other family calculates her holiday based on their days. The challenge is coordinating. A common agreement is for the nanny to choose two weeks, each family to choose one week, and the remaining weeks to be taken by mutual agreement.
• Sick Pay: Statutory Sick Pay (SSP) is managed by each employer. The nanny must meet the earnings threshold from each job to qualify for SSP from that employer.
• The Contract: It is vital to have a "nanny share agreement" between the two families as well as the employment contracts. This isn't a legal document, but it sets out the ground rules:
  • Where will the care be hosted?
  • How will you handle shared costs like food, nappies, or activities?
  • What is the policy if one child is sick?
  • What happens if one family wants to end the employment?

The Easy Way to Manage a Nanny Share

This sounds like a lot of admin. And honestly, it is. Each family has to become a fully compliant employer.

This is exactly why we designed Quinn to handle complex setups like nanny shares.

When you and your share family sign up to Quinn, our payroll service takes care of everything for you: From registrations and filings to payslips and payments. We'll run two separate, compliant payrolls, manage both pension schemes, and ensure all reporting to HMRC is handled.

Fully digital, no paperwork, no stress. We make nanny shares simple.