What should I charge as a self-employed paid carer?
There is a lot of planning to do when you are becoming a self-employed paid carer. One thing that you need to consider is what your charge is going to be for your services. This is important as you want to be competitive and offer good value for your clients in order to attract a lot of business, but at the same time you need to ensure that you earn enough for your lifestyle and your financial requirements.
What you can charge is dependent on many factors, including your experience, training and qualifications, but you also need to factor in what your costs are as this will influence what you need to charge to cover your costs and make a viable business.
The first thing to consider is how your business is set up. If you are a self-employed sole trader, then your income comes from what your clients pay you. Things like doing your admin and travelling between appointments are essential to your business but you’re not being paid while you do them. Therefore, it’s important that your client rate allows for this time. If you are a limited company, then you will pay yourself a salary instead, which means that you can allow for the time spent doing these tasks.
Travelling itself is a cost to consider as well. Buying a car, having car insurance, buying petrol, general maintenance, tax and so on all adds up, but it’s essential to your business in many cases. Keep a log of all transport costs, as these will be needed when claiming against tax.
You may use a phone and a computer to help run your business too, which means that you will have related costs here too, such as line rental, cost of calls, internet charges, printing costs and so on. Other equipment necessary for your job will also have to be factored in.
You will need to pay for your own insurance too, including Public Liability insurance. There are some companies that specifically offer insurances for paid carers. It’s essential to have this in place, as it covers you in the event that any claims arise for damage or harm caused through your actions. There are other insurances you may wish to consider, depending on your role and the services you provide. You will also need to have a current DBS check and this has ongoing costs.
You also need to consider the fact that as a self-employed person, you don’t get paid time off for holidays and sickness, so these costs need to be factored in too.
When you have all your costs listed, you can start to think about what you need to charge, which should cover your costs and make you a profit. You can charge by the hour, day or week, depending on what kind of service you are offering. If you are visiting multiple clients every day, an hourly rate may be easier to keep track of. However, if you work regular hours for the same people every week, you may find it easier for them to pay you one flat rate for the week or month, but include a minimum commitment term to ensure you are not left suddenly without pay.
Research the local companies, agencies and other self-employed carers in your area and see what they charge. You want to ensure that you are competitive with these to attract business, but also, don’t sell yourself short. You will likely be cheaper than an agency as you have lower overheads.
There are some tools that can help you to figure out the best amount to charge. We have a Salary Wizard on the website, which can quickly tell you what you would earn for charging a certain amount per hour and the number of hours you plan on working per week. This is a good starting point as it quickly tells you if you are charging enough to cover all of your costs.
Setting up a good budget is essential, as this helps to detail all of your costs and your prices for a good guide to whether you are charging enough. We have a Budget Template available to help you do this.
If you want to read more detail on this topic, then we have a booklet available called ‘Making your care business pay’, which looks at the areas we have covered here in more detail as well as much more information. This is also available in a bundle with the aforementioned Budget Template.