Help pass on what you know and earn money by becoming a tutor. 

We’ll cover all the business basics you’ll need to start tutoring, handle customer payments and stay tax compliant with your new income. Read on to find out more and how Countingup can help. 

Setting up as a sole trader with HMRC

Setting up a business means you’ll have to register with HMRC. There are a few different ways of doing this, but the easiest and fastest way is becoming a sole trader. 

Being a sole trader means you get to keep the profits you make and offers you flexibility as you run your business. Registering as a sole trader will allow you to pay taxes from your new business’ profits and get access to business support, like a dedicated business bank account and small business loans. 

If you’d like more information on what other types of businesses you can register and create, find out more in our article Sole Trader or Limited Company: How to Set Up Your Business.

Choosing a business name

As a sole trader, while you’re not required to choose a business name, it can help your business appear more professional. Many tutors don’t have a business name and instead prefer to use their own name for any customer-facing advertising. Therefore, it’s up to you if you’d like to have something more memorable. 

There are some rules to follow while choosing a name. Primarily, you’ll need to make sure the name you’d like to use isn’t taken already. Check for existing business names and trademarks using this online tool

Once you’ve found a name that you like and is available, make sure to use it consistently on any future adverts, business cards, paperwork and your application with HMRC. This can help your business appear more professional and trustworthy to customers, and to HMRC if you’re ever audited. If you want to protect your business’ name to make sure no one else uses it, you can register to protect it

Register as a sole trader by filing for self-assessment. If you want some more support and information on naming your business when registering, read our article How To Register As A Sole Trader.

Business records you’ll need to keep

Like any other business, you’ll need to keep records of your finances. Fortunately, being a sole trader means enjoying lighter paperwork, but you will need to keep records of:

  • The income and expenses of your business.
  • Records about your personal income.
  • PAYE records for anyone you employ.
  • VAT records (but only if you’re registered for VAT).
  • Grant money you may have received in 2020-2021 if you claimed through the Self-Employment Income Support Scheme because of COVID-19.

You’ll be required to keep these records for at least five years after the tax year deadline. 

For example, tax returns submitted for the 2021-2022 tax year by 31st January 2023 must be kept until at least 31st January 2028.

Over the next few years, sole traders are expected to transition to digital bookkeeping as their earnings increase above £10,000. Even with some expense receipts still provided on paper, finding the right digital accounting software is important. Find out more about why digital bookkeeping is affecting millions of UK business owners here and discover how Countingup can help below.

Finding and managing customers

Finding customers as a freelance tutor can be done in a few ways. 

Depending on what you teach, you may need to find more specialist websites to place listings on. For example, many ESL (English as a second language) tutors work with international tutoring companies to find customers and work at certain times to work around the time difference.

Contrastingly, you can place listings on UK websites like My Tutor, Tutor Hunt, Revision Centre and other tutoring platforms, or contact local schools, colleges and university societies to find people in need of subject-specific help.

Advertising your new business

Tutoring businesses tend to be operated locally (especially if you aim to teach school-age children), however, learners of all ages are adept at using technology and many will be willing to join online sessions.

If you’d like to operate locally, flyers or business cards can be a cheap and easy way to increase awareness of your business. As you’re looking to create printed materials, online services like Canva, Instaprint and Vistaprint offer professional design quality. If you want something more unique, you can either make it yourself, using software like Microsoft Publisher or Adobe InDesign, or work with a freelance graphic designer.

Many customers expect businesses of all sizes to have a website or social media account. Being online can help customers trust your business by letting them find important information, like operating hours or how to book with you. Therefore, your new business may also benefit from advertising online and there are tools you can use to still have a local focus. Find out more in our articles How to make your own website and How to Use Social Media for Business.

Other things to consider as you set up

If you operate locally, and especially if you’re working with school-aged children, you may benefit from having a disclosure check done to certify that you’re trustworthy as well as qualified. The process varies across the UK and in Scotland is known as the PVG or ‘Protecting Vulnerable Groups’ scheme. Find more on the website for information on where you live here.

Within a similar vein, you may need to refresh your knowledge of syllabus materials if you’ve been out of education for a while. In particular, some educational frameworks or assessment methods may have changed in recent years.

If you teach online or you’d like to accommodate more payment methods, you may wish to set up a PayPal or Venmo for students or their parents to pay you easily.

Save time on business admin from day one

Establishing and running a business takes commitment and effort. You can save hours of time and stress with the Countingup app.

Countingup is the business current account and accounting software in one app. It automates time-consuming bookkeeping admin for thousands of self-employed people across the UK. With instant invoicing, automated bookkeeping and cash flow insights, you can confidently keep on top of your business finances every day and spend more time building your tutoring client base. 

Find out more here.