From: AlanBaggett@volcanomail.com   
      
   6 things you need to know about hiring a nanny : CRA SOTW   
      
   A minimum wage salary may seem like a bargain but there are other expenses to    
      
      
   By: Sheryl Smolkin At Work, Published on Tue Aug 26 2014   
      
   Every parent who has ever bundled cranky preschoolers into snowsuits and   
   delivered them to daycare before heading off to work has at least briefly   
   wondered whether a nanny would be a better solution.   
      
   Daycare fees in Toronto can vary significantly. Depending on the age and stage   
   of the child, they can be as high as $2,000 a month. A nanny can take care of   
   several children and do other light household chores. If paid the minimum wage   
   of $11 per hour,    
   for a 40-hour week, it comes to $1,905 per month.   
      
   This may sound like a bargain if you have more than one preschooler, but   
   experienced nannies can command higher salaries. In addition to the salary you   
   must also pay employer contributions to the Canada Pension Plan (CPP),   
   Employment Insurance (EI) and    
   Workplace Safety and Insurance Board premiums.   
   Here are six things you need to know if you are considering the economics of   
   hiring a nanny.   
      
   Live in or live out? The advantage of a live-in nanny is that you don't have   
   to worry that she's going to be late as you head out the door in the morning.   
   You do need to have a big enough space so she can have her own room. If your   
   nanny lives in, you    
   can deduct $85.25 per week from her pay for room and board if she has a single   
   room. If she shares a room, it is $53.55 per week.   
      
   Domestic or foreign? The Live-in Caregiver Program lets families hire foreign   
   live-in caregivers when a Labour Market Assessment confirms Canadian citizens   
   and permanent residents are not available to do the job.   
      
   However, the process can be expensive and protracted. You must pay a   
   non-refundable fee of $1,000 each time you apply to cover the cost of the   
   assessment. You also have to pay for health insurance until your nanny is   
   eligible for OHIP. It can take months    
   or even years to process the visa. An agency may be able to help, but add   
   further expense.   
      
   Source deductions. Your nanny is an employee so you must deduct and remit to   
   the Canada Revenue Agency her CPP and EI contributions, and the required   
   employer contributions. In addition, you have to register with the Workplace   
   Safety and Insurance Board    
   and pay premiums to protect you both from costs associated with an injury on   
   the job. If you are paying your nanny a minimum wage, CPP, EI and WSIB costs   
   will add up to about another $190 per month. Even if you deduct room and board   
   for a live-in nanny,    
   source deductions are based on her gross pay.   
      
   Working conditions. The provisions of the Employment Standards Act apply to   
   the wages and working conditions of nannies. Part-time or full-time domestic   
   workers have the same rights whether they live in or out of their employer's   
   home. For example, they    
   are entitled to 4 per cent vacation pay, public holidays, pregnancy and   
   parental leave and termination notice and/or pay in lieu of notice.   
      
   Overtime. The ESA overtime rules lay out what must be paid. Overtime pay is 1   
   1/2 times the regular rate of pay and the threshold is more than 44 hours per   
   week. In a recent case, an Ontario Labour Relations Board awarded a live-in   
   nanny $10,000 in    
   overtime pay for watching the children when her employers went to the gym and   
   caring for the family pets when they were on vacation.   
      
   Income tax deductions. Like daycare fees, a portion of your nanny costs are   
   tax deductible. You can deduct $7,000 annually for each child age 6 or under   
   and $4,000 for each child between 7 and 16. The total child care deduction   
   must be taken by the lower-   
   income spouse or partner. Amounts paid for your live-in caregiver's airfare,   
   interim medical premiums and advertising or agency fees are also deductible up   
   to the maximum allowable amount per child.   
      
   Of course, the daycare vs. nanny decision is not purely an economic one. Many   
   parents prefer the convenience of a nanny who becomes like a member of the   
   family. Others want their children cared for in a more professional setting   
   surrounded by their peers.   
    Each family will select care for their children based on a unique combination   
   of economic, social and cultural factors.   
      
      
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   Visit the CRA SOTW Library at http://canada.revenue.agency.angelfire.com   
      
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