Accountancy \ tax advisor type question

[ClareC]

Wonder if anyone knows the answer to the following:- Not after detailed advice just really an indication of whether this is doable or not.

Both my boyfriend and I are employees of our own limited companies. I am currently on maternity leave receiving SMP but have been looking into child care needed for me to work again.

If we were to employ a nanny as our childcare solution, could we employ her by one of the companies thus avoiding paying for childcare out of our personal (net of tax) income?

My gut feeling is that to do so would incur a taxable benefit to the value of childcare for the employees concerned (me ?) presumably negating the benefit of emloying the nanny by the company rather than personally.

Thx :-)

[barrybrains]

I looked into this a few years ago, and I got varying answers from different sources, either accountants or Mums-in-Business helplines. I think there is an option to pay yourself dividends as income instead of a higher salary, then claim childcare vouchers, although it seems pretty complex to set up. There is also some option to have a 'workplace creche' but it wasn't suitable as we work from home.

I didn't go for the nanny option, just went for a childminder supplemented with a bit of tax credits instead.

[bumpy]

Hi ClareC, we're in the same position and were advised that we would not be able to employ the nanny through our business as childcare/nanny etc didn't fall in to the current nature of what our Ltd company is listed as doing. The one thing we have done is to register for the full value of childcare vouchers thus negating some tax. You don't have to pay yourselves a silly salary to do this. Good luck.

[Fuschia]

Your companies can each provide you with part of your salary (?243 pcm) as vouchers you can use to pay your nanny if she is ofsted registered. This will save you approx ?100 pcm each in tax and NI if you are higher rate tax payers

[ClareC]

That's great, thankyou everyone:-)

Does anyone know how we go about registering for childcarecvouchers?

Thankyou again :-)

[standswithfist]

www.childcarevouchers.co.uk

[new mother]

I've been told frequently it doesn't work though I have also heard people saying they claim. I don't think it's within the rules and, worse than being charged to tax n the benfit in kind, might even constitute evasion(!!).

your only alternative is to become an MP....