A childminder contracts with parents/carers to provide services on the childminder’s premises. A childminder is therefore not an employee of the parent but is self-employed, running their own business and is responsible for their own Income Tax and National Insurance.

Setting up considerations

Before setting up as a childminder, you should find out whether there is a need for childcare in your area, find out who your competitors are, consider what services you will provide and understand what gap in provision you will be filling. Oxfordshire Family Information Service can provide information about existing childcare, and may know about gaps in provision in your area. Oxfordshire County Council carries out an annual childcare sufficiency market assessment

You should also consider the costs involved in registering and setting up as a childminder and how these will be covered. Visit our becoming a Childminder page for more details.

In some circumstances, where a new childminding service will narrow a childcare sufficiency gap, Oxfordshire County Council may be able to provide a start-up grant.

The Working with Parents guide (pdf format, 1Mb) is designed to assist childminders with managing and negotiating their business relationships, helping childminders communicate effectively with parents on a range of issues.

Tax and National Insurance – self-assessment

HM Revenue and Customs (HMRC) require all self-employed people to register with them. You should do this when you first start in business – if you leave it too late you may be liable to a penalty.

As a self-employed person you will need to complete a self-assessment tax return, submit it to HMRC each year and pay any tax and national insurance due. This is not too onerous a task, provided you keep accurate records during the year.

Tax support

HMRC have a range of products especially designed for childminders to help with Tax and National Insurance:

• Join in a live webinar. You can ask questions and get answers. Choose a time to suit yourself – just check to find out when these are being run and register at Self-Employed Childminders and HMRC.
• Ready reckoner will help you to budget for your first tax bill.
• Record keeping is a crucial part of running a business so make sure you download the free record keeping apps.

For more information registering with HMRC, self-assessment tax returns and record keeping see HMRC.

Frequently asked questions

How do I set my fees?

Things to consider are:

• How much you need to earn?
• The hours you provide services – will you charge more if working in the evenings, weekends or bank holidays?
• The services you provide – do they include food, nappies or outings etc. or will you charge extra for these?
• Most childminders charge hourly but a daily or even weekly fee are also common
• Will you charge a retainer if the child is on holiday or if a new arrangement will not start immediately?
• Will you charge for late collections?
• Will you offer sibling discount?
• Will you offer funded early education places? – the rate paid by the Local Authority for these may differ from the fee that you charge.
• What is the going rate in your area? Oxfordshire Family Information Service will be able to provide average rates.

You should also be aware of the support available to parents to help with childcare fees and either help them access these or signpost them for further information.

Can I access early education funding?

Some childminders can offer early education places for eligible two year olds and three and four year olds by accessing the nursery education funding.

How do parents find out about my services?

Searching on the web is becoming increasingly popular so consider having your own website. As a minimum make sure your details are recorded by Oxfordshire Family Information Service on their online directory and are kept up to date. This a free service and is used by many families.

Once a childminder is established word of mouth is likely to be important and recommendations from satisfied customers can be one of the best ways of attracting new business. You might consider approaching some existing parents for references and testimonials that you could include in your advertising literature and on your website.

Can I employ assistants?

A childminder may employ an assistant, who may care for the same number of children as permitted by the by the ratios for the childminder. However children may not be left in the sole care of childminders’ assistants for more than 2 in a single day and then only if the parents/ carers’ have given permission, even for very short periods of time. You should refer to the Early Years Foundation Stage Statutory Framework (EYFS) for more information. It is a legal duty to inform Ofsted if you intend to employ an assistant.

If you do employ an assistant you will be an employer so you will need to:

• Register as an employer with HMRC and comply with employment law.
• Ensure that you have employer’s liability insurance and display the certificate.
• Ensure that you follow safer recruitment guidelines to ensure the people you employ are suitable to work with children. When recruiting ensure you follow employment law, including  the Equalities Act 2010
• Keep and maintain records of all assistants, including records of recruitment, their name, address, training and qualifications.
• Provide regular supervision and appraisals for your assistants, as required by the EYFS. This must include opportunity to discuss the well-being of children and any causes for concern.
• Ensure that your assistants are familiar with and operate to your confidentiality policy and have knowledge of the data protection act. As an employer you will need to keep staff records confidential too.

It is good practice to

• Have an induction programme
• Keep records of those who have been caring for children throughout the day, showing when assistants are left in charge of children or collect them from other settings.

Do I need to register for Data Protection?

The Data Protection Act 1998 requires organisations, including sole traders, handling personal data to register with Information Commissioner’s Office (ICO) in certain circumstances.

If you keep information about the names, ages and addresses of children and
their parents, details of payments, just for accounting, invoicing and records purposes, you are may be exempt from notification, although you should check with the ICO.

However as the Early Years Foundation Stage (EYFS), requires that you keep detailed records about individual children’s development, so it is likely that you will need to register with the ICO.

Currently registration costs £35 a year.

Will I have to pay business rates?

Most childminders are not required to pay business rates.

OFSTED registration requirements require childminders to operate from domestic premises.

The Professional Association for Childcare and Early Years (PACEY), have agreed with HMRC arrangements for certain household expenses to be apportioned as childminding expenses, including council tax (only charged on domestic properties).

HMRC elearning for childminders provides further guidance and explains the circumstances, where mortgage interest is claimed as a business expenses or where childminders choose to have rooms in their home only for the purpose of childminding where a liability to business rates may arise.

Do I have to register for and/or charge Value Added Tax (VAT)?

The provision of childcare services, by registered childcare providers, is exempt from VAT.

Businesses whose activities consist only of exempt supplies cannot register for VAT. This means they do not charge VAT on the services they deliver and cannot recover any VAT on any purchases of goods and services to be used in making those exempt supplies.

If your business is going to engage in activities other than the supply of childcare, you should check what the VAT liability of those activities would be. But so long as the value of any taxable supplies you make are below the current VAT threshold there is no obligation on you to register for VAT.

Can I be reimbursed for milk?

As a registered childminder, you can claim reimbursement for the cost of milk (189ml/⅓ pint) given to each child aged under 5 who is in your care for two hours or more per day. You can claim for infant formula, rather than milk, for a child aged under 12 months.

Download a Nursery Milk application form

Do I need planning permission

It is important to be aware that some local councils will require you to have planning permission when looking after a certain amount of children.

A local council usually says that up to 6 children for any one childminder in their own home would not require planning permission.

However when looking after more than 6 children a 'material change of use' has happened and planning permission may be required.

Please contact your local planning department if you are going to childmind more than 6 children.

For further information please contact

South & Vale district council: Planning.west@southoxon.gov.uk

Cherwell district council -  planning@cherwell-dc.gov.uk

Oxford City district council -  Planning@oxford.gov.uk

West Oxfordshire district council -  planning@westoxon.gov.uk

Vale of white horse district council -  planning@whitehorsedc.gov.uk