Helping out nanny employers
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For parents struggling with complicated tax forms for their nanny, a new start-up business is hoping to make their lives easier.
Tax4Nanny was launched in June by chartered accountant Gila Ossip to take the confusion out of all the mandatory tax forms families have to fill out every year when they have a nanny.
It's no joke â€” hiring a nanny makes you a full-time employer and you need to remit payroll deductions, provide an accurate T-4 form to your nanny each year and pay monthly Worker's Compensation like any other business.
"People find it very cumbersome â€” they are overwhelmed with all the paperwork," Ossip said.
Tax4Nanny takes care of all those important documents and deals with all inquiries and communications coming from the Canada Revenue Agency, leaving parents who employ a nanny free to spend precious at-home time playing with their kids instead of filling out tax forms.
Ossip, 34, got the idea for the service when she hired a live-in nanny to take care of her own daughter four years ago. She was surprised at how much paperwork was involved in employing a nanny and realized that many people probably felt the same way.
Parents pay $300 to $500 yearly for the service, a drop in the bucket compared to the $1,500 to $1,600 per month in salary and other fees it costs to employ a nanny legally in Canada. As a result, most of Tax4Nanny's clients tend to be high-income earners such as doctors or lawyers who already have sizable strains on their time and are happy to have an expert like Ossip handle the tax homework.
Ossip gave up a safe and lucrative job at renowned accounting firm Deloitte & Touche to strike out on her own and admits that running a business is a stark change from the certainty of a salaried position.
"I don't know where my next client is going to come from, but I am learning to become confident that the phone will ring," Ossip said.
In the few months since starting up in June, Tax4Nanny has already garnered 25 clients from across Canada and Ossip plans to take on many more. The majority of her client referrals come from nanny hiring agencies, many of which are happy to send parents to her as they aren't comfortable answering tax questions themselves. While business is booming, Ossip knows that the ride can eventually get bumpy, but says the risks are all worth it.
"I think there's going to be a big learning curve, but the excitement of working for myself is phenomenal," she said.