Do I need CQC registration to start a home care agency?

In England, yes, if you are providing personal care — it is a regulated activity and providing it unregistered is an offence. Wales, Scotland and Northern Ireland have their own regulators and processes. Introductory-only agencies that merely put clients in touch with carers sit differently, and that distinction is worth taking advice on before you decide your model.

How long does registration take?

Long enough that it has to be funded. The application requires a registered manager, policies and evidence of how the service will be run, and timelines vary. Build the plan so the business can survive the wait rather than assuming a best case.

What margin should a domiciliary care agency make?

Less than most people expect, which is why the cost per delivered hour has to be calculated properly. Fully loaded cost against your rate, with travel time included, tells you the real figure. Volume does not rescue a rate that is below cost.

Why does this page sell the writing service rather than the software?

Because the plan usually has to satisfy a regulator or a commissioner as well as a lender, and the financial structure — payer mix, travel time, debtor days by payer type — needs building rather than filling in. From £499.

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Domiciliary Care Business Plan

A domiciliary care agency cannot legally deliver personal care without registering with the regulator, and cannot register without a suitable registered manager. That shapes the whole plan: the timeline, the cost base, and what a funder is being asked to bridge. This guide covers the registration route, the numbers commissioners and lenders check, and the margin trap that catches new agencies.

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Written by Clive Unitt FCA, Founder & Chartered Accountant

What a lender or commissioner is assessing

Whether it is a bank, a Start Up Loan or a local authority framework, the same worries come up. Home care has thin margins, hard recruitment and a regulator that can stop you trading.

Whether you can register, and when. No registration, no revenue. The plan needs a realistic timeline from application to registration, a named registered manager or a clear plan to appoint one, and enough funding to cover the months before the first invoice is raised.
The true cost of a delivered hour. Not the carer's hourly rate. Wages plus employer's National Insurance, pension, holiday pay, training, travel time and mileage, plus a share of office and compliance costs. Agencies that price off the wage rate discover the gap several months in.
Recruitment and retention. Turnover in the sector is high, and every departure costs recruitment, DBS, training and lost continuity. A plan that assumes a stable workforce without saying how it will be kept is assuming away the main operational risk.
Who is actually paying. Local authority rates are lower and slower but volume is predictable. Private clients pay more and arrive unevenly. The mix drives both the margin and the working capital, and the plan should be explicit about it.

What it costs to set up

Setting up costs less than most regulated businesses. The working capital requirement is the harder problem, because staff are paid weekly or monthly and commissioners pay in arrears.

Cost	Typical range	What drives it
Regulator registration fee	See the regulator	Set by CQC in England, and by CIW, the Care Inspectorate or RQIA elsewhere in the UK.
Registered manager	Salaried	Required for registration. The largest fixed cost before any care is delivered.
Business plan and financial projections	From £499	What SquarePlan charges to write the plan and build the forecasts.
DBS checks and recruitment	Per carer	Enhanced DBS for every member of care staff, plus advertising and onboarding time.
Training	Per carer, ongoing	Care Certificate induction, mandatory refreshers, and specialist training where offered.
Insurance	Annual	Employer's liability, public liability and professional indemnity appropriate to care.
Care management software	Monthly, per user	Rostering, electronic call monitoring and care records. Commissioners increasingly expect it.

Registration fees are set by the regulator and vary with the size of the service. Check the current fee schedule directly rather than budgeting from a figure you read somewhere.

The figures that decide whether it works

Home care is a labour business with a regulator attached. Almost every number that matters is about people: what an hour costs to deliver, how much of the day is spent travelling, and how many carers you keep.

Cost per delivered hour: Every cost of putting a carer in a home for an hour, including travel time and employer's on costs. Compare it against your rate. If the gap does not cover office, compliance and recruitment, the model does not work at any volume.
Travel time as a share of paid hours: Travel between calls is usually paid time and always real cost. A tight geographic patch is worth more to margin than a higher hourly rate over a wide one.
Staff turnover: The single biggest controllable cost in the sector. Each replacement carries recruitment, DBS, training and a period of lower productivity, and continuity is what clients and commissioners actually judge you on.
Debtor days: Local authorities pay in arrears on their own timetable. Staff are paid on yours. That gap is the working capital requirement, and it is what most new agencies underestimate.

Registration and regulation

Providing personal care in someone's home is a regulated activity across the UK. Registration is a legal requirement rather than a badge, and delivering without it is an offence. Confirm current requirements with the regulator for your nation before relying on anything here.

Registration: In England, providers of regulated activities register with the Care Quality Commission. Wales is regulated by Care Inspectorate Wales, Scotland by the Care Inspectorate, and Northern Ireland by RQIA, each with its own process and fees.
Registered manager: A registered manager of suitable experience and qualification is required, and the application is assessed on the individual as well as the organisation. Recruiting one is frequently the critical path in the whole timeline.
Standards and inspection: Providers must meet fundamental standards covering safety, safeguarding, staffing and governance, and are inspected and rated. A rating affects commissioning as directly as price does.
Employment and safeguarding: Enhanced DBS checks, right to work, safeguarding policies and training records. This is also where a plan can differentiate: commissioners read staffing and training as a quality signal.

Registration is the plan, not a step in it

Most business plans treat compliance as a section near the back. In home care it is the critical path, because until the service is registered there is no lawful revenue at all.

That means the plan has to answer three things early: who the registered manager is or how you will recruit one, how long you expect registration to take, and what is paying the bills in the meantime. A funder reading a plan that skips the gap between application and first invoice will assume you have not thought about it, and they will usually be right.

The registered manager is often the constraint. They have to be suitable, available and willing to be named on your application, and the market for them is competitive. Securing one before you apply is worth more to the timeline than anything else you can do.

Cost per hour, done properly

The most common failure in this sector is not a lack of clients. It is delivering hours at a rate that never covered what an hour actually costs.

The carer’s wage is the start. Add employer’s National Insurance, the pension contribution, holiday pay accrual, paid travel time, mileage, and the training that has to be refreshed. Then add the share of the office, the registered manager, the software and the compliance work that every hour has to carry. That is the cost of an hour. Set it against your rate, and if the difference does not comfortably cover recruitment and the inevitable unbilled time, the model does not work — and it will not start working at higher volume, it will lose money faster.

Travel time is the hidden margin

Two agencies with identical rates and identical wage bills can have completely different margins, and the difference is usually geography.

Calls clustered in a tight patch mean carers spend their paid time delivering care. Calls spread across a county mean they spend it driving, and you pay for both the driving and the mileage. It also drives retention: carers leave rounds that are mostly travel.

This is worth modelling explicitly rather than burying in an overhead line, because it changes which work you should take. Turning down a well-paid call forty minutes away is often the right commercial decision, and a plan that has quantified travel makes that argument for you.

The cash flow gets worse as you grow

The uncomfortable arithmetic of home care is that growth consumes cash. You pay staff weekly or monthly; local authorities pay on their own schedule, in arrears. Every new package means more wages before more income.

So the cash requirement peaks not at launch but during expansion, which is precisely when it feels like everything is going well. A monthly cash flow that models debtor days separately for local authority and private clients is the only way to see it coming, and it is the difference between planning a facility in advance and asking for one in a hurry.

How this gets funded

The funding requirement is mostly working capital rather than capital expenditure, which some lenders understand better than others.

Working capital facility: The core need. Staff are paid before commissioners pay you, and the gap grows as you grow — which is the counter-intuitive part and the reason cash flow forecasts matter here more than in most sectors.
Start Up Loan or bank lending: Suitable for the pre-registration period and early trading. The application turns on the registration timeline being credible and the cost per hour being right.
Invoice finance: Advances against local authority invoices, which directly addresses the debtor-days problem. Costs margin, so model it properly rather than assuming it away.
Private client revenue: Higher rates and faster payment. Most agencies aim to build a private mix over time precisely because it fixes both the margin and the cash flow at once.

Frequently asked questions

Do I need CQC registration to start a home care agency?: In England, yes, if you are providing personal care — it is a regulated activity and providing it unregistered is an offence. Wales, Scotland and Northern Ireland have their own regulators and processes. Introductory-only agencies that merely put clients in touch with carers sit differently, and that distinction is worth taking advice on before you decide your model.
How long does registration take?: Long enough that it has to be funded. The application requires a registered manager, policies and evidence of how the service will be run, and timelines vary. Build the plan so the business can survive the wait rather than assuming a best case.
What margin should a domiciliary care agency make?: Less than most people expect, which is why the cost per delivered hour has to be calculated properly. Fully loaded cost against your rate, with travel time included, tells you the real figure. Volume does not rescue a rate that is below cost.
Why does this page sell the writing service rather than the software?: Because the plan usually has to satisfy a regulator or a commissioner as well as a lender, and the financial structure — payer mix, travel time, debtor days by payer type — needs building rather than filling in. From £499.

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Clive Unitt FCA

Founder & Chartered Accountant (FCA)

Clive is a Fellow of the Institute of Chartered Accountants in England and Wales and the founder of SquarePlan. He has spent over thirty years working with businesses from sole traders to multinational public companies.

He writes here about business planning, financial projections and the UK tax and funding questions that come with starting out.

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