Last updated 19th May 2025
Employing a nanny in New Zealand is a rewarding step for many families but it also comes with legal and payroll responsibilities that are important to get right.
Nannies can’t be paid with cash in hand, nor are they independent contractors, but instead need to be treated as an employee.
For households unfamiliar with employing staff, this can be a confusing and stressful process, and potentially very expensive if the correct procedures are not followed.
To make things clearer, we have outlined the steps you should follow if you want to know how to hire a nanny.
A good step to any employment relationship is to begin with an employment contract. When employing a nanny, a solid contract sets you up for success.
Things to consider when drawing up this contract are:
Check out our recently updated guide around employment contracts for nannies if you need more help.
There are a number of documents that you need to obtain from each employee before they start.
Before your nanny begins, make sure you have the following information:
If you are unsure which documents need to be completed email us. If you want to make the whole process simple
As soon as both parties have signed the employment agreement, you will need to think around payroll requirements.
There are two options here:
If you’re managing it all yourself you can register with the IRD and there are two ways to register:
Dealing with the IRD can be complicated and time consuming. Another option is to use a payroll provider like Pay The Nanny, which handles all aspect of the IRD, meaning you’re never required to even register as an employer, or deal with the IRD at all.
Although your payroll can be managed manually, we recommend that you use a payroll software. These help reduce manual errors and make filing and paying your monthly taxes much simpler.
There are a number of excellent cloud-based software to choose from:
Most payroll providers are fairly similar, but we find that Payhero has the best pricing structure and usability.
Late or incorrect payment of your nanny will swiftly land you in hot water with the IRD and lead to costly penalties.
The nanny taxes you will be responsible for paying are:
These need to be filed each time your process a payroll and are paid on the 20th of each month for the previous month. We recommend that you use a PAYE intermediary or a payroll provider like ourselves to avoid missing deadlines or incorrect payments.
As employees, nannies are entitled to holiday pay, public holidays, sick leave, bereavement leave and parental leave.
It is essential that you make the correct leave entitlement calculations.
The holiday pays act can be extremely complicated and it's always changing. If you're using a service like Pay The Nanny, they'll be able to help guide you with any tricky questions along the way.
Here at Pay The Nanny, our mission is to make it as easy as possible for households to effectively manage their payroll responsibilities for their nannies.
Pay The Nanny provides friendly, accurate and flexible nanny payroll services to nanny employers. We take care of everything to do with PAYE, ACC, holiday pay, sick pay, maternity leave and Kiwisaver.
For more information, check out our website at www.paythenanny.nz and give us a like on our Facebook page.