How to set up a childcare business

Business Legal Structure

There are many business legal structures available.  The legal structure for your business will need to be determined from the outset as this denotes the ‘person’ in law responsible for the running of the business, registering with Ofsted etc.  Please see below a list of some structures available, more information on business legal structure can be found on GOV.UK:

  • Sole Trader – A sole trader is considered to be ‘self-employed’. 
  • Partnership – You and your partner(s) personally share responsibility for your business.  Each partner must register as self-employed and submit a separate tax return.
  • Limited Liability Partnership (LLP) – In this legal structure, the number of partners is not limited, but at least 2 have to be ‘designated members’ responsible for filing annual accounts.  
  • Limited companies – A limited company is a company ‘limited by shares’ or ‘limited by guarantee’.  
  • Community Interest Companies (CIC) – A CIC is a special type of limited company which exists to benefit the community rather than private shareholders.
  • Charity – A charity must have ‘charitable purposes’ that help the public.