Should I buy the house next door for the nanny to live in?

[neo123]

The slight issue is that there is a "self-contained" rule. If the licensee is renting a self contained unit, then they can argue that, really, it isn't one single dwelling. Thus they are not living in your principal private residence, so they are a tenant, not licensee.

For safety, you want the licensee to share at least some required facilities with the rest of the house.

If the licensee has their own shower, kitchen, washing machine, and entrance, then they have a strong case that they are really renting out a self contained unit and it isn't your principal private residence.

Thanks for you thoughts on this. Under what i'm currently considering i'm confident it won't be "self contained". They will have their own bathroom/shower, living space and bed area, but would use the main kitchen facilities, washing facilities (in the garage) and same entrance.

Another issue is that minimum wage laws can make it difficult to rent out a room to an employee. If her job requires that she live in the house, then that is not something you can charge her much for. The allowance is tiny.

You can only charge EUR 33.42 a week for a room, if they are a live-in employee. I am not sure if that affects tenancy laws, maybe that allows them to stay a licensee.

I've been having this debate elsewhere and it's one that concerns me a bit. Let's say that rooms in the area rent for €800 excluding bills. It seems ludicrous that i could pay someone well in excess of minimum wage for ever hour of babysitting (€20 per hour), and to sweeten the deal offer them a discounted rent of say €600 including bills, but that this could then somehow be deemed to be non-compliant with minimum wage?

I'd also argue this individual isn't an employee, but a licensee renting a room in my home, who happens to provide a reasonable amount of babysitting on an ad-hoc. The babysitting requirement will (by necessity) be ad-hoc so i hadn't envisaged a contract or anything. Perhaps i'm being a bit naive.....

I posted on a more appropriate forum to tease out what childminders thought of such a structure, and overwhelmingly the posters thought it was a great proposal, but there were a small number of militant individuals who insisted it was illegal and an outrage

ou also have to pay minimum wage when they are on duty, even if they are asleep. The average per-hour rate for all hours they are on duty has to be at least minimum wage.

Absolutely agree on this. They would be paid for all hours for which they are present and in charge and i'm not there, regardless of whether they're asleep. I'd envisage this type of thing would be pretty rare, but likely if i was coming home at 1am or something, as opposed to overnight minding or anything.

 

[DannyBoyD]

I'd also argue this individual isn't an employee, but a licensee renting a room in my home,

Don't think that's an argument you will win.

Here's the thing:

You are a lone parent with 4 young children.

You need additional help; and to get that help you need to pay for it. By the sounds of it, you have a sufficent income to do so.

Family & friends are great to help out, but you can't call on them for the everyday stuff.

You have two areas you need help.

1. Day to day childcare / school runs / activities.

2. One or two evenings or a Sat/Sun to follow your own hobbies / interests.

I'd suggest hiring a daytime housekeeper / childcare from 2pm- 7pm, Mon-Fri

You do the morning routine, school etc.

Your housekeeper does school pick up, homework supervision, prep uniforms/ lunches for the following day & evening meal.

Item 2 is somewhat easier to solve, either with a local babysitter who can stay overnight or an Au Pair, who will live in, but they are only supposed to do 20 hours per week and are not an employee. [I stand corrected, Au Pairs didn't used to be employees, but clearly that has changed].

An alternative is to take a career break for a few years, claim One Parent Family & take care of the children yourself.

There are no 'cheap' ways out of this; pay for the help or do it yourself.

 

[balders93]

I'd also argue this individual isn't an employee, but a licensee renting a room in my home, who happens to provide a reasonable amount of babysitting on an ad-hoc. The babysitting requirement will (by necessity) be ad-hoc so i hadn't envisaged a contract or anything. Perhaps i'm being a bit naive.....

Very naive I'd say

https://www.williamfry.com/knowledge/update-labour-court-confirms-rights-of-au-pairs-as-employees/

 

[neo123]

Very naive I'd say

You're entitled to your opinion, but it's not clear that the situation is as black and white as that at all. Firstly i'm not looking to hire an au pair, and make up their compensation as a really low hourly rate plus allowance for food/lodgings to make it up to minimum wage. I'm proposing to pay them well in excess of the minimum wage for every hour worked, with no deductions beyond payroll/tax related ones. And to make it even more attractive i'm proposing to let them avail of accomodation at a significant discount the market rates. There is clearly no intent to take advantage of the individual here, and if the rules mean that it's not permitted that's idiotic. The example in the case you provided is a very different situation....

So i could do rent-a-room no questions asked at €750 per month and have an army of people begging to take the room.
I could have babysitting at €20 an hour to another individual for babysitting, and again i'd have a queue down the road of individuals very happy to take on this work, and again this would be completely fine.
But for some reason combining these two things with the same individual (for the convenience of both parties) is problematic. I'm sorry, if that's the rules, it's completely stupid. And what i'm proposing is considerably better for the person as well as it's a significant discount on what they'd have to pay elsewhere.

There are no 'cheap' ways out of this; pay for the help or do it yourself.

To be fair, i don't think most reasonable people looking at what i'm proposing would suggest that i'm trying to do it on the cheap. I'm trying to come up with a setup/package that could work very well for both myself and the babysitter.

From my perspective, I have babysitters but the main thing i'd like is a bit more flexibility in this. If you're getting a babysitter in, there's a minimum number of hours for which it's worth their while. So popping out to the gym for an hour is just impractical, and it can't be done at short notice. Similarly, if i wanted to stay out a bit later after a meal/show in town that's much easier to do if the person lives there and can just go to bed themselves, as opposed to an external person who'd have to stay up and then make their own way home. Many babysitters might not drive as well, so them getting home safely is a concern late at night.

Clearly the appeal of this setup for me is the flexibility it offers. For the babysitter they get a good hourly wage, and additionally very cheap accomodation in a well maintained house and desirable area, with large amount of private space to themselves.

pay for the help or do it yourself

I am proposing to pay for it. I'm just exploring what package/setup might work for what i need. What i need is kind of the opposite of the schedule you outline. I do not want/need housekeeper/minding Monday to Friday 2-7pm. They attend an afterschool i'm very pleased with, which enables them to do loads of activities easily. As described earlier, a minder would spend their time walking around the area picking/dropping various kids to different activities, with the remainder of the kids in tow. A nanny 2-7pm would be considerably cheaper, but it's not the best solution for us.

My needs are much more so evenings and saturdays, with a focus on flexibility for the reasons outlined above.

 

[DannyBoyD]

popping out to the gym for an hour is just impractical, and it can't be done at short notice. Similarly, if i wanted to stay out a bit later after a meal/show in town

I think you might need to accept that your life right now needs to be much more planned and organised. You are not in a position to be able to choose to do things 'at short notice' or 'stay out later' just because you feel like it.

If you already have childcare in place (and again from your OP that wasn't clear); then what you need is to organise your external activities. And again, this is relatively short term; things will change a lot in the next 5 years.

 

[neo123]

I think you might need to accept that your life right now needs to be much more planned and organised. You are not in a position to be able to choose to do things 'at short notice' or 'stay out later' just because you feel like it.

I think that's a bit defeatist to suggest to just "accept" that i'm not in a position to "to do things 'at short notice' or 'stay out later' just because you feel like it". Like anyone with kids, the ability to just make plans at a moments notice is much more limited. However, that doesn't mean it's not sensible to set yourself up in a way that makes things somewhat more flexible.

What i'm proposing achieves this and could work very well for many people. The overwhelming interest (and support) from minders on a more relevant website shows no issue getting someone to sign up to the proposal. So clearly it's something that can be done quite easily......so perhaps i shouldn't just accept my life needs to be completely rigid.

I have no desire to do something that's not fully compliant (whether that's minimum wage, or revenue etc) hence why i'm teasing out some options here.

and again from your OP that wasn't clear

Considerable additional information has been provided in later posts as the thread evolved from the initial query which was on buying a property, to a more focused discussion on the setup of a childcare/rent a room.

It's worth reading the full content of the thread and the info provided before adopting strong positions like "no cheap options - just pay for it", when i clearly outlined that i'm able and willing to do so. Or to just "accept" that i'm "not able to" have a flexible setup for the next 5 years or more.

Keeping up a job, while being the sole parent to a number of young children is extremely challenging. Of particular importance for my sanity and welfare is maintaining an active social life outside the home, with other adults to converse and engage with. I expect from your posts you've not been in a remotely similar position, so to be fair can't fully appreciate the challenges and why it's so important to me.

I don't think anything i've asked or proposed is particularly outlandish, and i appreciate those who have contributed their thoughts on the thread. But i think some individuals could try and put themselves in the position of the OP, when deciding if their contribution is helpful/useful

 

[DannyBoyD]

being the sole parent to a number of young children is extremely challenging.

100% agree

Of particular importance for my sanity and welfare is maintaining an active social life outside the home, with other adults to converse and engage with.

also agree 100%.

Your current responsibilities however mean that planning and scheduling, not spontaneity are the order of the day.

I expect from your posts you've not been in a remotely similar position, so to be fair can't fully appreciate the challenges

Never make assumptions.

 

[Bronte]

The slight issue is that there is a "self-contained" rule. If the licensee is renting a self contained unit, then they can argue that, really, it isn't one single dwelling. Thus they are not living in your principal private residence, so they are a tenant, not licensee.

This is incorrect. There is no argument. A self contained unit is allowable under Rent a Room. It’s specifically mentioned on revenue.ie. The only rule is it has to be attached to the house, converted garage or converted attic all are allowed. What is not allowed is if you have a detached garage or shed.

The OP doesn't want a tenant or need a tenant. Part of the attraction of the childcare job will be the converted garage.

 

[Leo]

I'd also argue this individual isn't an employee, but a licensee renting a room in my home, who happens to provide a reasonable amount of babysitting on an ad-hoc. The babysitting requirement will (by necessity) be ad-hoc so i hadn't envisaged a contract or anything. Perhaps i'm being a bit naive.....

If there is any regularity to the child-care responsibilities, the WRC are clear they must be treated as employees. Your earlier description of the role of the nanny suggest much more than lending an occasional hand once every week or two that might allow you avoid that. You need to protect yourself against the relationship souring and this person taking you to the WRC.

 

[chris45]

Might be a good investment of time to contact some Nanny agencies and discover what the normal expectations are for those employees.
They deal with this day in and day out and will have a wealth of experience in this area.

 

[TomEdison]

I think that finding someone to fill the role you have in mind will not be straightforward.

What you want is someone who will work

- on Saturdays (say 8 hrs); and

- after school every day (say 3hrs/day or 15 hrs/week); and

- some evenings during the week (say two evenings at 4 hrs each), but this will vary from week to week and will have to be negotiated.

Total is about 31 hrs/week.

What you’re offering is a part-time gig with quite a lot of hours, but at fairly inconvenient times. If part of the deal is that they are required to live in your house, they would expect that accommodation to be provided for free.

Paying them the minimum wage of €14.15/hr, and making the maximum deduction for accommodation provided, you’d have to pay about €405/week. You could express this in terms of a larger hourly rate and a larger deduction for accommodation if you like, so long as the net figure is still €405 or higher. That’s €21,000/year, more or less, It’s an attractive deal for the worker — €21k plus free accommodation — but it’s expensive for you. (More expensive, if you want extra hours in school holidays, etc, but let's park that. Plus I'm ignoring employer's PRSI, auto-entrolment contributions, etc — this is back-of-the-envelope stuff.)

The only way that I can see to reduce the cost to you is to split out the work and the accommodation. Suppose you hire someone who doesn’t live in your house to work Saturdays and after school every day and, separately, you let out a room in your house under the rent-a-room scheme to someone who doesn't do any work for you. If you pay someone the minimum wage for 31 hrs/week, that’s €22,800/year, but you can subtract the €14,000 you could get under the rent-a-room scheme from someone else. The net cost is only €8,800. You’re funding your childcare by letting out a room.

Problem with that is that you have a stranger living in your house with your four kids, who isn’t otherwise involved in their lives, which you might think is not ideal.

 

[Bronte]

Problem with that is that you have a stranger living in your house with your four kids, who isn’t otherwise involved in their lives, which you might think is not ideal.

This is really easy. Self contained unit. Own front door, plus door into house that is not used.

 

[neo123]

after school every day (say 3hrs/day or 15 hrs/week); and

Thanks for your input. Just one clarification is that i don't need/want afterschool care as that is already sorted and works very well for us. So what's required is the rest of what you list (8 hours on saturday, plus maybe 2 evenings a week 4-5 hours, and ideally (if the person was living with and it suited them) ad-hoc hours here and there. So perhaps 20 hours max.

Your other points about inconvenient times are fair enough. For some people i can see why they wouldn't be desirable, but for others who perhaps are studying during the day, or have a daytime job and want regular extra cash i would have thought it would be fairly appealing. I don't envisage it would be for someone who has no other income, and the individual may already have a full time/part time job they'd keep in addition if they so wish. I don't need someone during the usual working week for many people (M - F 07:00 - 18:30)

I posted up on childminding forum to guage interest/fairness in what i was thinking, and there were overwhelming agreement that it was a good deal for the person (but not unanimous, there were a small number of dissenters). But as @Leo says above, i don't want a situation where someone takes me to the WRC......

Multiple individuals have already expressed interest in the role from that post so i think finding someone for the role will be quite straightforward actually, but whether they'd then take me off on a trip to the WRC at some later stage is the question.....

The only way that I can see to reduce the cost to you is to split out the work and the accommodation. Suppose you hire someone who doesn’t live in your house to work Saturdays and after school every day and, separately, you let out a room in your house under the rent-a-room scheme to someone who doesn't do any work for you. If you pay someone the minimum wage for 31 hrs/week, that’s €22,800/year, but you can subtract the €14,000 you could get under the rent-a-room scheme from someone else. The net cost is only €8,800. You’re funding your childcare by letting out a room.

As per the above, the numbers are off here, as the required hours are much lower, but your substantive point seemS the most sensible/cleanest that should avoid the main issues
1 - Rent a room to a student/local worker at full market rent
2 - Hire a regular person for the saturday shift that is static
3 - Continue with ad-hoc babysitter setup for evenings out. Perhaps the student would be up for elements of this, but it would clearly be ad-hoc.

 

[TomEdison]

This is really easy. Self contained unit. Own front door, plus door into house that is not used.

A self-contained unit requires more than own front door. It requires a bathroom and kitchen facilities, which I don't think the curent layout of the house can accommodate. So some potentially expensive work there.

i don't need/want afterschool care as that is already sorted

My misunderstanding. That does simplify things.

What you essentially want is a Saturday worker, who will also do maybe two evenings a week, to be negotiated. That shouldn't be impossible to find. And for evenings that couldn't be negotiated with the Saturday worker, the lodger might or might not be open to filling in, if they were suitable. Or you could fall back on the curent arrangements for occasional babysitting that you already use from time to time. So you do have options.

20 hrs/week at minimum wage is €14,700, which just a bit more than the €14,000 that you can take tax-free under the rent-a-room scheme, so thing begins to look like a wash. You've indicated that you intend to pay more than minimum wage, plus you will obviously have higher utility bills with a lodger occupying an additional room, plus some other additional costs, but they shouldn't be huge.

As mentioned, unless you spend a bunch of money putting in a separate kitchen and bathroom you'll have a relative strange sharing your childrnen's home, which is not ideal but it's something you might be willing to put up with, to make the rest of the arrangement work. Obviousl this consideration, plus the hope that the lodger might be amenable to doing a bit of babysitting if needed, will influence who you will accept as a lodger.

 

[Bronte]

A self-contained unit requires more than own front door. It requires a bathroom and kitchen facilities, which I don't think the curent layout of the house can accommodate. So some potentially expensive work there

Yes we already suggested to him to do a one bed as he has plenty of space, well worth the expense to do it right on many fronts.

 

[LarryScott]

This is incorrect. There is no argument. A self contained unit is allowable under Rent a Room.

I agree, Revenue allows self-contained units for rent-a-room relief.

If you rent a self-contained unit that was part of the house, then you can get rent-a-room relief. Any payment is tax free.

That doesn't affect the tenancy laws though (probably).

This was discussed before.

Landlord renting out a self contained flat or apartment in his own home

I have just read this article on the citizens advice page regarding a landlord letting out an apartment in his own home. This may well have been covered here before and I either missed or misunderstood it but is yet another example of how complex the new rules will be. I had known and understood...

www.askaboutmoney.com

The rules for tenancy are separate. You rent a (self-contained) room for up to 14k per year, and pay no tax on the income.

However, the licensee could claim that they are actually renting a self-contain dwelling. If so, the tax status is not affected, but suddenly they are tenants with a tenancy and tenancy rights.

In theory, a landlord is exempt from the security of tenure rules in that case though.

However, there is a sting in the tail. To qualify for the exemption, the landlord has to notify the tenant before the tenancy starts.

If the landlord though it could have been a licensee agreement, then they wouldn't have done that. Thus, the tenant will have a full tenancy, including security of tenure rights.

I wonder if you could have a term in any licensee agreement. "In the event that a tenancy is created, then security of tenure rules will not apply and this constitutes notification under Section 25 of the RTA". If the tenants specifically signed that clause, then maybe it would be ok. Though it would be notifying them of a potential problem with the rent-a-room.

 

[LarryScott]

This is the relevant section from the Act.

25.—(1) This Part does not apply to a tenancy of a dwelling where the conditions specified in subsection (2) are satisfied if the landlord of the dwelling opts, in accordance with subsection (3), for this Part not to apply to it.
(2) Those conditions are—
(a) the dwelling concerned is one of 2 dwellings within a building,
(b) that building, as originally constructed, comprised a single dwelling, and
(c) the landlord resides in the other dwelling.
(3) A landlord's opting as mentioned in subsection (1) shall be signified in writing in a notice served by him or her on the tenant before the commencement of the tenancy.
(4) This Part does not apply to a tenancy of a dwelling—
(a) if the landlord of the dwelling is entitled, in relation to expenditure incurred on the construction of, conversion into, or, as the case may be, refurbishment of, the dwelling, to a deduction of the kind referred to in section 380B(2), 380C(4) or 380D(2) (inserted by the Finance Act 1999 ) of the Taxes Consolidation Act 1997 , or
(b) if the entitlement of the tenant to occupy the dwelling is connected with his or her continuance in any office, appointment or employment.

Any merging of buildings would violate the rule that it has to have been 1 dwelling when constructed. Also, you can't split an apartment, since it has to be only 2 dwellings in the building.

This also answers another question.

Security of tenure doesn't apply if it is connected with employment (4b). Though presumably the other rules do apply.

 

[Mammysboy]

The role reminds me of a live in carer for the elderly in some ways. A example of costs and terms and condition is here: https://www.alhomecare.ie/prices

Best of luck with the journey, for what it's worth it sounds like a very good plan to me and upgrading the garage etc seems like the most practical solution.

 

[TomEdison]

I wonder if you could have a term in any licensee agreement. "In the event that a tenancy is created, then security of tenure rules will not apply and this constitutes notification under Section XYZ of the RTA". If the tenants specifically signed that clause, then maybe it would be ok. Though it would be notifying them of a potential problem with the rent-a-room.

We discussed whether an agreement that comes within the rent-a-room scheme can also create a tenancy registrable with the RTB, etc. in this thread. The answer is that yes, it can.

Briefly, it depends on whether what you are letting out is a self-contained unit (which I think, if it includes bathroom and kitchen facilities, it definitely will be) and on whether the person to whom you are letting it has exclusive possession - i.e. they have the right to keep other people, including the property owner, out. It won't be a tenancy if the area let is also used by the property owner — e.g. he keeps some of his good shtere, and goes in and out as required to retrieve or replace them.

But the arrangment suggested in this case, at any rate if the room has its own kitchen facilities (i.e. it's a "bedsit" type arrangement) does look as though there will be a tenancy registrable with the RTB.

In which case the landlord should definitely serve the s. 25 notification to disapply Pt 4. I wouldn't faff about with a conditional notification; I think the RTB would go through you for a short cut. And I think the very fact that you included such a think would mean you were aware that it might very well be a registrable tenancy, in which case the RTB would ask the obvious question; why didn't you register it? So I think you'd end up with the worst of both worlds; a registrable tenancy that you haven't registered, and a confusing attempt to disapply Pt 4 that the RTB would very possibly hold to be ineffective.