This is a question we hear often in the nanny industry, and it’s an important one to understand. The way a nanny is classified – as an employee or self-employed – has serious legal, tax, and professional implications.
The short answer is: most nannies cannot be self-employed.
Why most Nannies are employees
HMRC decides employment status based on how work is carried out, not what either party prefers. A nanny is usually considered an employee because:
- They work for one family on fixed days and hours.
- Their duties are directed by the family.
- They are paid a regular wage.
This relationship fits the definition of employment rather than self-employment.
When self-employment might apply
There are some limited situations where HMRC may accept self-employment. This usually applies if the nanny is genuinely working for themselves and not tied to one family. Examples include:
- Providing ad hoc or irregular childcare (different hours each week).
- Working for multiple families at the same time.
- Operating more like a temporary or freelance childcare provider than a consistent, long-term nanny.
For instance:
- A temporary nanny covering short-term roles.
- A nanny running their own service for occasional bookings.
- A nanny offering babysitting to several families on a freelance basis.
In these cases, the nanny is managing their own schedule and income, which aligns with self-employment.
Why it matters
Incorrectly classifying a nanny as self-employed when they should be employed can cause serious issues for both parties, including:
- Backdated tax and National Insurance demands from HMRC.
- Loss of employment rights for the nanny (holiday pay, sick pay, pension contributions).
- Potential financial penalties for the family.
Correct employment status protects both the nanny and the family and ensures professionalism in our industry.
The Association’s position
At the National Nanny Association, we are committed to promoting best practice across the nanny sector. We strongly encourage families to employ their nanny via PAYE in almost all circumstances. This safeguards nannies’ employment rights, ensures families remain compliant, and upholds standards within the profession.
If you are a nanny considering self-employment, or a family unsure about the correct approach, we advise checking HMRC guidance or seeking professional payroll support.
You can also read our dedicated guide on how to employ a nanny, including recommended payroll companies for further support.
✅ Key message: Unless a nanny works ad hoc hours for multiple families, they should be employed, not self-employed.