Here's what you need to know about how to start a tutoring business in the UK. In this post, we cover your legal structure, expenses, qualifications, how to obtain a DBS certificate, insurance, earnings and a whole lot more.
Article updated 03/04/2018.
According to an article published in the Huffington Post, there are now over 500 private tutoring agencies operating in the UK, some with over 10,000 private tutors on their books.
Each year, parents spend an estimated £6 billion on private tutoring and according to the Sutton Trust, 50% of children in London receive regular private tuition. The demand for tutoring has grown year on year over the last decade and In 2013, Global Industry Analysts, Inc. (GIA) predicted that the global tutoring market would surpass $102.8 billion by 2018. For more information on the industry in general, have a read of our post An Overview of the Private Tutoring Industry in the UK.
Working with students is a hugely rewarding job, not to mention a great way to earn a living by being your own boss. Here is our comprehensive guide on how to start a tutoring business UK.
Your Legal Structure as a Sole Trader
All private tutors who run their own tutoring business need to be registered with HMRC. Even if you only tutor part-time, you still need to declare your earnings to the government. Most tutors start out as sole traders and keep their own financial records. A simple income and expenditure spreadsheet should be fine to help you keep track of your earnings.
As a sole trader, you need to complete a self-assessment tax return every year after the 5th April and the easiest way to do this is online. You have 3 months from when you begin your self employment to inform HMRC of your status and obtain your Unique Tax Reference (UTR) number. For more information on paying tax, have a read of our post Paying Tax as a Tutor in the UK.
Your Initial Expenses as a Tutor
One of the reasons that starting a tutoring business in the UK is so appealing is that there are very few barriers to entry. Initial overheads for starting a tutoring business are relatively low. In fact, all you really need to get started is textbooks and stationery. Have a think about what teaching materials you might need for the subject and level you intend to tutor. It’s always a good idea to have the same versions of books as your students to ensure you’re working from the same material.
If you choose to set up your own website, will you be able to create one by yourself or will you need to pay a web designer to create one for you? A professionally designed website could cost from £500 for a basic site, up to £10,000+ for something more complex. If you feel like learning some basic web design skills, you could save yourself significant costs by using an open source website builder like WordPress.
You should also consider whether you will tutor from your own home, or whether you’ll travel to your students. If you do decide to travel, you’ll need to account for travel expenses as an ongoing cost.
What Qualifications Do You Need to Start a Tutoring Business UK?
There are no standard qualifications for private tutors in the UK, so anyone who has good knowledge in a specialist subject can become a tutor. People offer tuition services over a wide range of subjects, generally categorised into academic, music, arts and professional services.
The tuition industry doesn’t have a governing body but industry standards tend to dictate that tutors should at least be undergraduates.
Obtaining a DBS Certificate as a Tutor
Although it’s not compulsory, it’s recommended that anyone in the UK who works with people under the age of 18 has a Disclosure and Barring (DBS) certificate, showing that they have no restrictions in working with young people. It’s worth bearing in mind however, that private tuition isn’t only limited to teaching young people – many people offer tuition to adults over a whole range of specialist services.
To obtain a DBS Certificate, you need to apply via a third-party organisation such as an employer, a recruitment service, a tutoring agency or a similar umbrella body. For more information on how to obtain a DBS check, have a read of our article DBS Checks for Private Tutors.
For a general overview of how to apply for a DBS check, take a look at this video from the Home Office:
Applying for Insurance for Your Tutoring Business
Public liability insurance is generally recommended for all private tutors, whether you tutor in your own home or at students’ homes. This type of insurance provides cover in the event that you’re held liable following injury to a student or damage to third party property. However, public insurance isn’t a legal obligation. Professional Insurance is also considered by some tutors as a means of protection against legal proceedings as a result of misinformation or misguidance. For more information, check out our post Insurance for Tutors: What You Need to Know.
How Much Can You Earn Running a Tutoring Business?
Although most tutors tend to work part-time, many have made a career out of tutoring full time and report earnings equivalent to teachers on an M6 pay scale – around £30,000 a year. Of course, this won’t happen overnight and it takes time to build up a client base in your local area but it can be done. In fact, a recent analysis found that private tutors earn 38% more than secondary school teachers.
The private tuition industry in the UK is known as a ‘free market’, meaning that it’s free from regulation by a governing body and the Government. Private tutors set their rates based on current market standards, which at the moment tends to vary from place to place. In London, some tutors charge as much as £100 an hour for one to one tutoring, whereas elsewhere in the country, hourly tutoring rates can be as low as £10 per hour.
We’ve compiled data from every tutoring rate survey over the last few years and found that the average tutor in the UK earns between £15 and £41 per hour. Of course, there are several factors that affect how much a tutor can charge, all of which we’ve covered in our post Private Tuition Fees: Average Tutoring Rates per Hour.
Paying Tax as a Self Employed Tutor
As a private tutor, you have to declare any earnings you make to HMRC as you would with any other employment, regardless of whether you have another full-time job or not. Once you’re registered as self employed, you’ll be sent a Self-Assessment Tax Return every year after the 5th April which will instruct you on how to declare your earnings for the previous year.
Being self employed also means paying your own Class 2 National Insurance contributions and if you earn over a certain threshold, you also need to pay Class 4 contributions. However, it is possible to defer your National Insurance payments and depending on your earnings, you may also be exempt from paying tax on your earnings altogether.
For more information on getting your tax in order, read our info on how to pay tax as a private tutor. In order to find out if this applies to you, please contact HMRC for further guidance and information.
Marketing Your Tutoring Business
Initially, finding students to tutor can be challenging, especially if you don’t have any experience and your business isn’t known in your local area yet. The finer details of marketing as a private tutor is worthy of a blog post all its own, but generally speaking, traditional marketing methods work well for tutors – adverts in shop windows, flyers and leaflets, although the most effective way of promoting your tuition business is online.
There are several advertising platforms online for private tutors, including private tuition directories like The Tutor Website, where you can create a profile and have students and parents contact you directly. Having your own website and promoting yourself on social media websites like Facebook and Twitter can also help spread the word about your business.
For more information on marketing your tutoring business, we’d recommend the following articles:
Expanding your Business into a Tutoring Agency
As your business expands, you may wish to consider hiring other people to work for you or you may want to set up your own tuition agency, in which case, unless you decide to outsource, you’ll need to change your legal structure and become a Limited Company. You’ll also need to adhere to employment agency law and should seek appropriate advice from relevant qualified bodies. For more information on growing your business into an agency, read our post How to Start a Private Tutoring Agency.
The Tutoring Agency Business Model
Tutoring agencies work as middle men, introducing students to private tutors and charging a fee for the introduction. They then charge a commission on each lesson afterwards, usually somewhere in the region of 10%. Every agency operates slightly differently; some allow tutors to set their own rates, whereas others have a pricing structure in place, whereby more experienced tutors are more expensive.
This model has proven to be very successful for many independent agencies and some have even gone on to open several tutoring centres throughout the UK.
However, when you’re first starting out as a tutoring agency, it’s advisable to keep your overheads low. Nowadays, thanks to the growth of the internet, many tutoring agencies exist virtually and don’t have fixed office locations.
Recruiting Tutors for Your Agency
The most credible tutoring agencies have a thorough recruitment process for selecting their tutors. If you intend on establishing yourself as a credible agency (which you should do), then you’ll need to register to carry out DBS checks as an employer, providing you’ll be carrying out more than 100 checks per year. Registration costs £300 and you’ll need to follow the DBS code of practice.
Credible agencies also meet all their tutors face to face and conduct an interview with potential employees. You should also follow up references from previous employers and students, before offering tutors a place within your agency.
Finding Your Agency’s Unique Selling Point
The most successful agencies position themselves in the marketplace by offering something that no-one else in their local area does. By doing some competitor analysis, you’ll be in a better position to find your unique selling point. Consider what gaps exist in your local area? Is there demand for tuition in a particular subject that no-one else is currently offering?
What do you want people to think about when they hear the name of your tutoring agency? What will they associate it with? By considering your overall branding, you’ll be able to create a recognisable, trusted tutoring business.
For more information on how to start a tutoring business UK, check out our guide How to Start Your Own Tutoring Business.