Written by Oliver Wakefield-Smith. Reviewed for accuracy against the Homecare Association's 2026/27 minimum-price report and Age UK's 2026 factsheets. Numbers verified 21 June 2026.
Direct payments and personal budgets: the DIY route
A direct payment is the right of any council-funded adult to receive their personal budget as cash and arrange the care themselves[8]. The headline saving: a directly employed PA costs £14-£18/hr, against £28-£35 for an agency carer[1].
What you take on as the employer
- PAYE income tax and National Insurance via HMRC[9].
- Employer NICs (currently 15% on earnings above £5,000 from April 2025).
- Holiday pay accrual (12.07% of hours worked).
- Statutory Sick Pay where applicable.
- Pension auto-enrolment after qualifying earnings.
- Employer's liability insurance.
- A written contract of employment.
How councils help
Most councils contract with a payroll service (commonly PASS, Penderels or Premier Care Support) that handles PAYE and NICs on your behalf. The cost is paid from the personal budget. SCIE's at-a-glance guide[26] and Skills for Care's individual-employer resources[19] are the right starting points.