Employing a Nanny in Sydney: Tax, Super and Your Obligations (2026)

Finding the right nanny is the lovely part. The part that makes most Sydney families pause is everything that comes after “yes” — tax, super, payslips and the quiet worry that you might be getting something wrong.

The good news: it's far simpler than it looks. When you employ a nanny in Sydney, you become a household employer, and there's a short, well-defined list of things to get right. Here's a clear walk-through for 2026, written in plain English.

This is general information, not tax or legal advice. For your own situation, check with the ATO, the Fair Work Ombudsman or a registered tax agent.

First things first: your nanny is almost always an employee

This is the one that trips families up. It's tempting to treat a nanny as a contractor who “invoices you” and sorts out their own tax. In reality, the vast majority of nannies are employees, not contractors — because you control their hours, where they work and how they do the job.

It matters because the obligations below flow from that employee relationship. And even where a nanny genuinely operates as a contractor for their labour, the ATO can still treat them as your employee for superannuation. In short: assume you're an employer and you'll rarely be caught out.

What about nannies with an ABN?

You may come across nannies who work as self-employed contractors with an ABN. They invoice you for their hours, manage their own tax, and you don't run payroll at all. It feels simpler, and for genuinely casual, occasional care it can be a reasonable arrangement.

Two honest caveats before you rely on it:

• An ABN doesn't change the relationship. If your nanny works set hours, in your home, under your direction, the ATO is likely to treat them as your employee regardless of the invoice — and the obligations below still apply.

• Super can still be owed. Where a contract is wholly or principally for a person's labour (which nannying almost always is), super may be payable even to an ABN contractor, subject to the same 30-hour rule.

A good rule of thumb: ABN arrangements suit ad-hoc babysitting-style care; regular weekly care is employment. If in doubt, ask the ATO or a registered tax agent before you start.

Tax: PAYG withholding and payslips

As an employing household, you're generally expected to:

• Have your nanny complete a Tax File Number (TFN) declaration when they start, so you withhold the right amount.

• Withhold PAYG (pay-as-you-go) tax from their wages and pass it to the ATO. To do this you register for PAYG withholding (you can do this as an individual — you don't need a company).

• Give a payslip within one working day of payday, and keep records for seven years.

• Provide an income statement / payment summary at the end of the financial year so they can lodge their return.

If that sounds like a lot to run yourself, it's exactly what a nanny payroll service is built for — more on that below.

Super: the 30-hour rule every Sydney family should know

Superannuation is where in-home care has its own special rule. The super guarantee rate is now 12% of ordinary time earnings (it reached its final legislated step on 1 July 2025 and stays there).

For most jobs, super is owed on the first dollar. But for private domestic work — a nanny, housekeeper or carer in your own home — there's a threshold:

You only have to pay super if your nanny works more than 30 hours in a week, regardless of how much you pay them.

So a nanny doing three full days that tip over 30 hours is owed super; a part-timer doing two short days generally isn't. It's the hours that matter, not the dollars.

One more change worth a note: from 1 July 2026, “payday super” begins, meaning super needs to be paid at the same time as wages (reaching the fund within a few business days) rather than once a quarter. If you're setting up now, it's easiest to plan for paying super alongside each pay run from the start.

Pay rates and Fair Work

Your nanny is covered by the national minimum wage and the National Employment Standards, which set the floor for pay, leave and entitlements. That includes:

• At least the national minimum wage (casual roles also get a casual loading on top).

• Paid leave for permanent (non-casual) nannies — annual leave, sick and carer's leave.

• Reasonable notice and proper record-keeping.

Many families choose a casual arrangement for flexibility (a higher hourly rate, no paid leave) or a permanent part-time/full-time arrangement for consistency (paid leave, a set roster). There's no single right answer — it depends on the rhythm your family needs. If you're still weighing up the budget side, our 2026 guide to how much a nanny costs in Sydney breaks down the numbers.

Insurance and a few practical extras

A couple of things that are easy to overlook:

• Workers' compensation / household insurance — check whether your home and contents policy covers a domestic employee, and look into workers' compensation requirements in NSW. A quick call to your insurer settles it.

• A written agreement — hours, pay, duties, notice and what happens on public holidays. It protects everyone and prevents the awkward conversations later. Our step-by-step guide to hiring a nanny in Sydney covers what to include.

The easy way to handle all of it

Here's the honest truth: most Sydney parents don't want to become payroll administrators. You have two simple options to take it off your plate:

1. A nanny payroll service handles PAYG, payslips, super and end-of-year statements for a small monthly fee — you just approve the hours.

2. Working with an agency means the placement, the paperwork guidance and the right setup are sorted from day one, so you start on solid ground.

At Nanny Nest, we place carefully chosen nannies with Sydney families and help you get the employment side right from the very first week — no guesswork, no late-night ATO searches.

When you're ready, you can start your nanny search or book a quick call and we'll walk you through exactly what your family needs.

Quick checklist

• Treat your nanny as an employee (ABN contractors only suit ad-hoc care)

• TFN declaration completed on day one

• Registered for PAYG withholding

• Payslips every payday; records kept for 7 years

• Super at 12% if they work more than 30 hours/week

• Plan for payday super from 1 July 2026

• Pay at or above the national minimum wage

• Written agreement and insurance checked