Hi.
I wonder if someone could help me.
I have been employed as a nanny (including paid leave, tax, super where necessary, paid sick leave etc).
Recently, they decided that the child I cared for would go to kinder instead of having me which is absolutely fine. The family approached me afterwards and asked if I'd be interested in caring for the child every now and again to which I replied yes as it would just be some extra hours I could declare as extra/other income on my tax return(?).
I will be employed - part time - by another family from next week officially (Inc all benefits mentioned earlier). I performed a trial day this week.
My old employer family have asked now if I'd care for their child 4-5hrs every second or third week (not guaranteed). They've advised that their accountant has said I should work as a contractor for this role, and I feel they have put pressure on me to take out an ABN in order to perform this role.
I have been a nanny for eleven years (granted most of that was in the UK - where I'm from) and have never been a self-employed nanny. I've always been employed. Any additional hours I've done for other families ad-hoc or one-off have gone down as extra cash income which are taxed accordingly at the end of the tax year.
I had no intention of setting up an ABN - business - for what would be a maximum, unguaranteed, ten hours work a month. This means more outgoings for me, more than one tax return and potentially paying for insurances that I never use as I'm not looking for any other work in this setting.
I've tried to use the employee vs contractor tool and it always says I'd be an employee. I've spoken with other nannies and most disagree I should be setting up a business for this little an amount of work. It's difficult because it's a very casual setting. It's not a contract, it's not employment, it's casual babysitting really and I'll be actually employed elsewhere.
I've also spoken to the tax office on the phone and I'm passed back and forth between ABN and personal income tax without a definitive answer.
I haven't written an agreement or contract or sent any invoices. The family have sent me a small letter stating I'll be working as an independent contractor which is not something we discussed beforehand.
My question, or questions, are;
1) if I work ad-hoc for a maximum of eight to ten hours a month for a family, can I declare it as other income when doing my tax return?
2) Do I have to set up an ABN?
3) Is there a benefit for the family if I am a contractor rather than a casual employee/occasional babysitter?
4) Is there a benefit for me?
At the moment, I can't see any pros to me setting up an ABN to do a role I wasn't anticipating. I had no intention of doing so. I feel like the family are still very much in control of what hours I'd work. This is something I see as an extra favour as the child has had me every week for the last almost three years and I've become a real friend/family member to them.
Additionally, I am concerned about the legitimacy of setting up an ABN as a casual nanny/Babysitter for one family and infrequent work.
I hope you can help me and steer me in the right direction.
Many thanks.
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