Are you considering hiring a nanny to look after your children? In most cases, if you are hiring a long-term nanny, you will need to pay nanny tax. Even if you are only paying a neighbor down the street $100 a week to watch your kids, that expense is likely taxable. It is important to pay your nanny taxes as any nanny that you employ is a taxable asset in the eyes of the government. Tax4Nanny provides our clients with help with all of their nanny taxes.
Average Cost of Nanny Taxes in Ontario
After recently proposed changes to minimum wage, how much do nanny taxes cost in Ontario? This is a valid question. Here is a rough break down of how much you will pay your live-in nanny and how much you will owe on your nanny tax.
At $15 an hour, 44 hours, paid every 2 weeks you will have to account for a gross pay of $1,320.
Your nanny taxes (federal tax, provincial tax, CPP, and EI) will cost around $295.57.
On average, room and board taxable benefit will be around $170.50.
Nanny’s net pay will be $1,024.43.
Additional deductions (taxes listed above, and employer’s contributions to CPP and EI) totaling $396.71.
WSIB premium $37.09.
Overall, including your nanny taxes, you will pay $1,421.14 every 2 weeks.
While nanny taxes may seem expensive, always pay them and stay on the right side of the CRA. Do not leave yourself vulnerable to an audit. Tax4Nanny is here to help you solve all of the problems that you may have in regards to your caregiver taxes. We will simplify the process for you. If you have any questions about our service, please feel free to contact us. We offer our services to clients in Toronto, throughout the GTA, and all of Ontario. We can’t make you love taxes, but we can make them easier for you.