Resources | Live-in caregiver wages & payroll deductions

Payroll Examples

One of the biggest deterrents to hiring a live-in caregiver is the delusion that it would cost a fortune to have a live-in caregiver. The following example of a typical caregiver's earnings and deductions helps dispel this widely-held misconception.

Live-in Caregiver's Payroll Details

Pay period type

Monthly

Gross pay*

$1,412

Statutory payroll deductions:

Canada Pension Plan (CPP) contribution

Employment Insurance (EI) premiums

Income tax deductions

Total deductions

173

(173)

Remaining gross pay

1,239

Room and board deductions

(369)

Net pay to employee

$870

Employer's statutory contribution

+90

Total remittance to Canada Revenue Agency (CRA)

263

+263

Total payroll expenses

1,133

Employer's income tax saving**

(195)

Net cost to employer

$938

* The gross pay is based on a 32.5-hour work week for a live-in caregiver in Ontario where the prevailing wage rate is $10.56 per hour.
** The tax savings are based on CRA's tax tip and a conservative assumption that the employer family has only ONE child under the age of 7 and the secondary income earner makes about $50,000 per year (thus the marginal tax rate is about 33%). If the family had TWO children, the tax savings would be close to $400 per month and the employer's monthly cost would be only $700 something!

Note:

1.	Although other provinces have different wage rates and tax rates, the monthly cost for the employer to have a live-in caregiver is not significantly different.
2.	A live-in caregiver's wages can also be claimed as attendant care expenses and result in similar income tax savings for a family that hires the caregiver to care for the frail elderly, the chronically ill or people with disabilities living at home.