Paying your licensed nanny "under the table".

Goodness me! Never do that! You are taking a large risk. It is undeclared work which can mean "big trouble with the law." Certainly the cost of your childcare provider may seem like a lot, but do not yield to the temptation to pay this way: you would receive no aid!

The disadvantages for the childcare provider.

There are many disadvantages for childcare providers who do not declare their income, besides the fact that it is illegal! Here are just a few:

• She cannot claim her expenses (mortgage, gas, electricity, water, groceries, advertising and so on).
• She will not be paying into her pension plan for retirement or contributing to Employment Insurance should she not be able to work.
• She will not be able to provide receipts to parents which means that parents will not be eligible for government aid or tax reductions or rebates.

Paying under the table, what are the risks for the employer?

• First of all, if you are paying your childcare provider under the table, she cannot provide you with receipts which means you are not eligible for provincial or federal aid. That means you are missing out on up to $7000 in tax deductions alone, per child.
• You could face fines for knowingly paying an employee under-the-table.
• The fact that your childcare provider wants to be paid under-the-table says something about her character; that she is dishonest. What else might she be hiding?

For which reasons might a childcare provider ask you to pay under the table?

Several possible cases:

• She is on unemployment or maternity leave and she will not be able to collect these benefits if she is working, and she wants to keep collecting.
• She is collecting other benefits that she would not have the right to if she earned more or she would have a higher tax rate on her income.
• She has been suspended or lost her license.
• She doesn't have her working papers.