Childminders' self-employed tax information

If you're a childminder, you're self-employed for tax purposes.

Working from home can make it difficult to separate business and non-business expenses so there are special rules for childminding.

The following expenses can be claimed against your income. 

Expenses directly related to childminding activities

Any expenses directly related to earning the childminder fees are allowable for tax purposes.

The type of expenditure allowable includes food and drink, stationery, toys, books and the cost of outings.

Heat and light

Full time childminders, who care for children in their own home for 40 hours a week or more, can claim a deduction of one-third of household fuel bills.

Part-time childminders can claim a proportion, for example a childminder who works for 20 hours per week can claim one-sixth of household fuel bills.

Rent and rates

Full time childminders can claim a deduction of one-tenth of rent and rates paid.

Part time childminders can claim a proportion of this.

Motor expenses

If a motor vehicle is used for outings, a deduction of 60p per business mile may be claimed. This flat rate claim includes both running expenses and capital allowances.

Alternatively, you can claim the exact fuel expenditure on these trips and make a claim for capital allowances restricted to the business use of the vehicle. can be claimed on the cost of the vehicle.

The proportion of capital allowances that can be claimed is calculated by taking the mileage of the vehicle used exclusively for childminder activities divided by the total mileage of the vehicle throughout the year.

Motor expenses claim form

Capital expenditure

Relief for capital items purchased solely for childminder activities (eg, playpens and cots) can be claimed in one of two ways.

Replacement items cost

Replacement allowances can be claimed if an item of equipment is replaced provided that capital allowance have not previously been claimed on that item.

You can't claim for the cost of the items at the start of the business or for any new piece of equipment.

You claim a deduction for the cost of replacing items. Relief is given for the whole replacement cost in the year.

Capital allowances

Capital Allowances can be claimed from the year in which the items are purchased (this includes the commencement year). Capital Allowances effectively give relief on capital expenditure at 25% per annum on the ‘written down value’ of the items.

Example
Cot bought for:			£400
	Year 1*	Allowance 25%	£100
		Written Down Value c/f	£300
	Year 2	Allowance 25%	£75
		Written Down Value c/f	£225
	Year 3 etc.

*If year 1 is at the start of the business then the allowance will be restricted by reference to the number of months in the first year of assessment that the business has been operating.

Should any of the items on which capital allowances have been claimed be sold then these items need to be taken into account in the capital allowances calculation.

Capital allowances for tax explained

Wear and tear of household furnishings

Childminders can claim one-tenth of their gross fees to cover "wear and tear" of household items not used exclusively for childminding activities. No capital allowances or other deductions can be claimed for those items.

Example of a childminders income and expenses

These amounts are declared in the self-employment section of the full eight page return.

​Description	​Amount (£)	​Where entered on tax return
​Income	​36,000	​Box 1
​Expenses	​	​
​Motor expenses (60p per mile)	​1,000	​Box 6
​Stationery	​50	​Box 15
​Heat & light (1/3 of household bills)	​1,000	​Box 16
​Rent & rates (1/10 of household bills)	​1,250	​Box 17
​Wear & tear (1/10 of income)	​3,600	​Box 19
​Food & drink	​2,000	​Box 19
​Toys & books	​1,000	​Box 19
​Outings	​950	​Box 19
​Business licence	​300	​Box 19
​Net profit	​24,850	​Box 24
​Items that are entered in the same box on the tax return need to be added together and entered as one amount​.

Keeping records

You don't need to send in your records with your tax return but you must keep them for seven years.

Record keeping if you're working for yourself

Childcare tax relief

Registered day care providers are required to supply a certificate annually to the parents of the child showing how much was paid for the child's care.

Child care tax relief certificate