Setting up a childminding business - Finder UK

Setting up a childminding business

This guide covers the key need-to-knows if you're setting up a childminding business in the UK.

If you love taking care of children, setting up a childminding business can be a fulfilling and even profitable career. However, there are quite a few steps you need to take in order to do it properly. In this guide, you’ll discover some key tasks you’ll need to complete to get your childminding business up and running.

What is the definition of a childminder?

The regulator Ofsted defines a childminder as an individual who looks after other people’s children:

  • Who are younger than 8 years old
  • For 2 hours or more per day
  • In the individual’s own home or someone else’s home

If you don’t meet this definition, you may need to register as a nanny or daycare owner. These roles have different regulations, so it’s important to be clear about what your official job title is.

How do you register as a childminder?

In order to start a childminding business, you must be registered as a childminder with Ofsted.

There are different registration services available depending on whether you live in England, Wales, Scotland or Northern Ireland.

You’ll need to provide details of:

  • The appropriate criminal record (DBS) check, your paediatric first aid certificate and childcare training
  • A completed health declaration
  • Two references
  • Your premises to host children, and who lives there

Ofsted will perform checks on the premises before you’re registered as a childminder. The registration process can typically take up to 12 weeks.

Registering your childminding business

You’ll need to register your childminding business with HMRC for tax purposes.

It’s best to do this as soon as possible, so you can avoid backdated tax bills, although the official deadline is 5 October in your business’s second tax year.

When registering your business, you’ll need to decide what business type you want to register as.

Your main options are:

  • Sole trader. Here, you and your business are one and the same for tax and legal purposes. That means you’ll continue to pay income tax and national insurance as an individual. It also means you can be held personally liable for business debts or lawsuits.
  • Partnership. This works in a similar way to being a sole trader except that you’re splitting the income with your business partner(s).
  • Limited company. Your childminding business becomes an entity in its own right, with finances that are separate from yours. You have to submit records to Companies House and HMRC and pay business taxes. You’ll pay income tax on the wage you’ll pay yourself from your business income. You can’t be held personally responsible for business debts.

What insurance do you need to run a childminding business?

Most small business owners will find it essential to invest in the following types of insurance:

    • Public liability insurance (PLI). This protects you against paying legal costs or compensation if someone or something is hurt or damaged thanks to your business activity. This includes damage caused by children, as well as injuries or sickness suffered by them.
    • Professional indemnity insurance. This protects you against paying legal costs or compensation as a result of a lawsuit for negligence in the workplace.
    • Employers liability insurance (ELI). This protects you against the cost of legal claims if an employee suffers a job-related illness or injury.
    • Business contents insurance. This protects against covering the cost of lost or stolen business equipment.

      Some insurance companies offer childminding insurance, which protects you against all of these potential outcomes.

      How to write a childminding business plan

      You don’t have to write a business plan when you’re launching a childminding business but it could help you succeed. Perhaps more importantly, it’ll allow you to spot potential hurdles to success or reasons not to start a childminding business before it’s too late.

      A great childminding business plan would include:

      • Company overview. The name of the business and its owners, the business type and its address. Perhaps a short mission statement, explaining your goals for the company.
      • Your target market. Who will you market your childminding to and why? It pays to be as specific as possible. The better you know your audience, the easier it is to market to them.
      • Products and services. A full list of what products and services are offered by your business, plus how much you will charge.
      • Competitors. Who are your competitors? How does your childminding business differ from theirs? Why is yours better?
      • Marketing plan. Are you planning to leaflet the school gate? Where will you market your business? What is your monthly marketing budget for each marketing platform?
      • Financial plan. How much will it cost to launch your business? What are the estimated monthly running costs? What are your monthly sales forecasts? (It is recommended to list minimum viable target, average target and stretch targets).

      How much should you charge?

      It’s a common phrase that “the market decides your price” and that’s true of childminding too.

      You should research what your competitors charge and price your services based on this. If your service is superior, you should be able to charge more and still attract customers.

      If your competitors are far more experienced, you may have to charge less in order to establish yourself.

      How to market your business

      Here are some great marketing ideas for your childminding business.

      • Flyers. This is an affordable marketing platform, but it makes sense since you’re most likely only targeting customers in your local area. Pay for a professional design and offer these flyers in venues around schools, parks and local businesses where parents are likely to visit. Stick them on a board at local shops if they have a local services board.
      • Business cards. Get professional business cards printed, and be prepared to hand them to everyone you know. If your peers don’t have children, perhaps they know someone who does. Referrals are a powerful marketing tool. Don’t forget to give some business cards to your existing customers, so they can easily refer you too.
      • Social media marketing. It’s free to set up business accounts on all social media platforms, and this could really pay off when it comes to getting your name out there. Perhaps you could use these pages to share details of the fun activities you’re enjoying with your children. You won’t be able to post pictures or stories about individual children without their parents’ permission though.
      • A blog and search engine optimisation (SEO). If you launch a childcare blog and have it well optimised for search terms surrounding childcare and your local area, you could attract clients through Google searches. There’s nothing stopping you repurposing your social media content on your blog and vice versa.

      Open a business bank account

      A business bank account basically works like a personal one – the main difference is that it’s dedicated to your business’s finances. You should therefore expect the same features, such as a debit card, the ability to make and receive payments, an overdraft option, a banking app and so on.


      Use Tide to open a business bank account

      • Award-winning, smart, simple business account
      • The hassle-free account for your business
      • Get your sort code and account number in minutes

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