Before your Personal Assistant starts

If you are an employer, for example you are or planning to employ a Personal Assistant then it is a legal requirement for you to have specific insurance in place.

Accidents can occur in various ways. For example, your Personal Assistant might trip or fall whilst working for you. In such instances, the Personal Assistant may attribute blame to you, the employer, and hold you accountable.

Your Personal Assistant might also conduct clinical / medical tasks and both of you need to feel safe in case a mistake arises.

Ensuring the appropriate insurance coverage is in place means that should there be a claim, it will be covered by the insurance policy and managed by the insurance provider.

The cost of the insurance premium is included in your Direct Payments, however it is the responsibility of the employer to make sure that premiums are paid on time.

If your Personal Assistant is self employed, they are responsible for sourcing their own insurance.  Please also review the employment status section to see more information on the employment status of Personal Assistants.

Vehicle insurance

It is important you check with your vehicle insurance policy and/ or Motability scheme / private lease terms when allowing others to use your vehicle.

• Motability Scheme 'Your Drivers'

You must have an agreement, 'contract of employment', between you and your employees so that you are both clear about each other's responsibilities.

You can receive a contract of employment template from your insurance provider, the insurance provider will be able to assist with the completion of the template.

Please note that from April 2026 there will be changes to employment rights, in particular Statutory Sick Pay (SSP) becoming a day one right (no waiting days) and all employees qualify, regardless of hours or pay level.  This means your employee no longer has to wait several days or meet a minimum earnings level to receive Statutory Sick Pay.

There are also changes to paternity leave, employers keeping holiday pay and annual leave records for six years and an employee's right to join a union should be in their contract of employment.

It is strongly recommended that employers of Personal Assistants seek advice and guidance around writing a new contract of employment from April 2026 for anybody they employ.

A payroll service handles payroll calculations for you, including the tax and National Insurance contributions to deduct from your Personal Assistant’s (PA’s) pay, and the amount to pay them. They will register you as an employer and act as your agent with HMRC, as well as calculate any pension entitlement and provide guidance on pension payments.

You can arrange for all payroll calculations to be sent into your Virtual Wallet and the Virtual Wallet will make any necessary payments on your behalf, leaving you to relax in the knowledge that once set up, everything will be taken care of.

Payroll provider information

Below is some information on payroll providers, the Direct Payment recipient only needs to choose one provider.  The payroll provider will calculate the employees pay and inform the individual and Virtual Wallet of how to pay any tax / National Insurance to the HMRC.

The two main payroll providers are at present Independent Lives and PPL Virtual Wallet: -

Independent Lives

Independent Lives provide a Payroll service for £7 per week, regardless of the number of Personal Assistants an individual employs.  The Independent Lives website (https://www.independentlives.org/services/direct-payment-support-services/banking-and-payroll/) provides comprehensive information on managing payroll for Direct Payment recipients. Here are the key points:

1. Payroll Service: Independent Lives provides a comprehensive payroll service to manage the payroll for the individual’s Personal Assistant/s. This includes handling all aspects of payroll, such as calculating wages, tax, and National Insurance, and providing payslips, based on the information provided. The payroll service will be funded through the Direct Payment and paid through the Virtual Wallet, this information will be placed within the Direct Payment recipients care and support plan.
2. Setup Process: To use Independent Lives payroll service, the individual will need to complete an employer and employee payroll setup, including necessary HMRC forms and a form that allows payment via the Virtual Wallet if applicable. Independent Lives can provide support with completing the necessary payroll setup.
3. Support and Independence: Independent Lives payroll service is designed to reduce stress and make managing financial obligation easier in combination with the Virtual Wallet, taking the pressure off the Direct Payment recipient.
4. Personal Assistant/s and HMRC Payments: Payments to the individual’s Personal Assistant/s and HMRC will be made via the Virtual Wallet, once Independent Lives notify the individual and the Virtual Wallet. Independent Lives will notify HMRC if no payment is due in a particular month.

Virtual Wallet Payroll

Virtual Wallet Payroll provide a Payroll service for £9.60 (including VAT) for the first Personal Assistant payslip and then £4.80 (including VAT) for any additional Personal Assistant payslips.  The Virtual Wallet website (https://www.myvirtualwallet.co.uk/virtual-wallet-payroll/) provides comprehensive information on managing payroll for Direct Payment recipients. Here are the key points:

1. Payroll Management: Virtual Wallet Payroll handles all payments to an individual’s Personal Assistants, including the online completion of timesheets and digital payslips, calculations for tax, national insurance, pension contributions, sickness and maternity pay.
2. Additional Deductions: The service also manages attachments of earnings and student loan repayments.
3. HMRC and Pension Support: Virtual Wallet Payroll provides support with HMRC obligations and auto-enrolment pensions. This includes guidance on registering with HMRC, acting as your payroll agent, electronic filing, and processing P45 and P60 forms.
4. Pension Management: Virtual Wallet Payroll handle pension calculations and payments, ensuring compliance with any necessary pension auto-enrolment requirements.
5. Ease of Use: The service is integrated into the individual’s Virtual Wallet account, making the process of managing employee, pension and HMRC payments straightforward and efficient.

Contingency planning means having a plan in place for times when your employee is sick, on annual leave or unavailable for another circumstance.

Contingency planning might include hiring temporary cover or making alternative arrangements.

Contingency planning also includes financial planning to ensure you have enough budget in reserve to pay for any unplanned cover for your Personal Assistant or an unexpected expense in relation to your care and support.

Whether you are hiring a Personal Assistant (PA) for the first time or seeking to clarify your existing arrangements, it is crucial to understand the distinctions between employed and self-employed statuses.

Misclassification can lead to significant financial penalties and legal consequences.

The Direct Payment Support Service invites you to contact the employer's helpline of your insurance provider for legal and personalised advice. 

The Direct Payment Support Service can provide this information sheet in an alternative format upon request.

Whether you need assistance with personal care, administrative tasks, or household duties, hiring a Personal Assistant can significantly enhance your quality of life.

Please explore our other resources on the PA Finder to  make informed decisions and create a successful working relationship with your Personal Assistant.

The Direct Payment Support Service can provide this information sheet in an alternative format upon request.

As an employer, you have a legal duty to help your Personal Assistant save for retirement.

• Read more about providing a pension in the section 'Paying your personal assistant'.
• The Pensions Regulator - contact page

Redundancy is when you ask your personal assistant to leave, either because you do not need to employ them anymore or because you need to reduce the number of staff you have

• Information about redundancy
• Redundancy information from Acas

Your Personal Assistant is entitled to have maternity, paternity, adoption and parental leave and pay

• Information about maternity, paternity, adoption and parental leave

You have a legal responsibility to make sure that your Personal Assistant remains safe and healthy whist doing their job.

• Health and safety information including a downloadable checklist
• Health and safety executive
• Risk assessment template

Oncosts refer to additional costs associated with employing staff beyond their basic wages. These may include employer’s National Insurance contributions, pension contributions and other benefits. Here's what you need to know:

• Employer's National Insurance Contributions

In addition to paying your staff member's wages, you will sometimes see ‘Employer’s National Insurance’ or an abbreviation on their payslip. Employer’s National Insurance is simply National Insurance for Employers. Most employers can claim up to £10,500 per year through their payroll provider.  This is known as Employment Allowance, your payroll provider will do this automatically on their behalf. 

The £10,500 per year Employment Allowance is per employer, not employee.

To find out more about Employment Allowance, particularly in regards to employed Personal Assistants, please visit: - Employers of care and support workers and Employment Allowance: further employer guidance - GOV.UK

For more general information about Employment Allowance, please visit: - Employment Allowance: Check if you're eligible - GOV.UK

Please note that Employment Allowance (provided by HMRC) is different from Employment and Support Allowance.

• Pension contributions

As an employer, you may need to enrol eligible employees into a workplace pension scheme and make contributions on their behalf. Auto-enrolment regulations apply, so ensure compliance to avoid penalties by communicating with your payroll provider.

The minimum contribution by law is 8% of your staff member’s earnings. As the employer, you must pay at least 3% of this. This 3% will be budgeted for within your Direct Payment.

For auto-enrolment, the minimum amount of gross pay required is £520 a month, or £120 per week.

But even if your staff member earns less than £520 a month, they can still join the pension scheme if they want to. You, as the employer, can't refuse.

Also, if your staff member has more than one job but earns less than £10,000 a year in each of them, they'll need to actively request to opt in. That's because although their total income is more than the auto-enrolment threshold, they are assessed by each employer separately.

• Explore other benefits

Depending on your circumstances, you may need to provide other benefits such as holiday pay, sick pay or maternity/paternity pay. Familiarise yourself with your legal obligations and budget accordingly.