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.

Can a nanny work on an ABN?

Usually not, for regular care. A nanny can have an ABN, but having one doesn't change the relationship. The ATO looks at how someone works, not whether they have an ABN. If your nanny works set hours, in your home, under your direction, they're usually your employee, even if they send you an invoice.

One-off or occasional care can be different, depending on how it's set up. If you're unsure, the ATO's guide to employees and contractors can help you check.

Paying a nanny as a contractor when they're really an employee can leave you owing back tax and super down the track. Setting it up properly from the start keeps everyone protected.

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 thing worth knowing: since 1 July 2026, “payday super” has applied, meaning super must be paid at the same time as wages — and generally reach your nanny's fund within 7 business days — rather than once a quarter. If you're setting up now, the simplest approach is to pay super alongside each pay run from the start.

Pay rates and Fair Work

Your nanny is covered by the Miscellaneous Award 2020 and the National Employment Standards, which set the floor for pay, leave and entitlements. That includes:

• At least the minimum rate in the Miscellaneous Award (casual nannies also get a 25% 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 — in NSW, you need workers' compensation insurance if you pay more than $7,500 a year in wages, which covers most regular nannies. Some home and contents policies already include it, so check yours first.

• 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. There are simple ways to take it off your plate:

1. A nanny payroll service handles PAYG, payslips, super and end-of-year statements for a small 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, start your nanny search and we'll walk you through exactly what your family needs.

Quick checklist

• Treat your nanny as an employee (not an ABN contractor)

• 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

• Pay super with each pay run (payday super has applied since 1 July 2026)

• Pay at or above the Miscellaneous Award minimum

• Workers' comp sorted (over $7,500 a year in wages) and a written agreement in place