Money stuff
Tax - childminders are self employed and responsible for their own tax and national insurance. You are legally obliged to contact the tax office when you start working as a childminder and inform them - you can register as self-employed online. You will then receive a self employment tax return the following April.
Support for childminders - you will find support for doing your tax - income and expenses - in the free guidance from Childcare.co.uk - accounts folder.
**HMRC also publish a childminder specific page of guidance here.
Remember!
**The tax year runs from the 5th April to the 6th April, so you cannot give any figures that relate to income/expenditure outside of these dates.
**It's normal to make a loss in your first year because of buying toys, resources and other start up costs. Your tax return must show your income from any start up or other grants as well as childminding income.
**You must keep your business records separate from household accounts – some childminders choose to use a separate bank account but this is not a requirement. However, with the proposed introduction of Making Tax Digital (now delayed until after 2026) you might need a business account - more information to follow.
**You will need 3 main figures for your tax return – income (from childminding, any other jobs, taxable benefits, houses you might rent out, bank investments etc)... minus expenses (as below)... equals total taxable figure.
Note that you do not need to keep receipts for purchases under £10.
**You must keep your records for 5 years after the end of the tax year.
**You are advised to keep food receipts for 3 months, to comply with food hygiene regulations - this is not an Ofsted or HMRC requirement.
**Your accounting books are not usually of interest to Ofsted - however, they can ask to see them if they relate to, for example, a complaint about a child's attendance. Your Local Authority might also ask to look at your income and children's attendance if you are audited for funding. You should note this on your Data Audit.
**Don't put large amounts of expenses you cannot justify and don't put through things if you don't have proof of purchase for them;
You will find more information, including templates, in e-book 51 - 'Money Matters' on my Knutsford Childminding website.