What legalities do you need to consider when starting a tutoring business? (2020)

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 Paula Antalffy
legal

There are a number of reasons why you might want to consider starting a tutoring agency. These may include wanting to be a business owner or expanding your services to meet demand. (Click here to read about the signs suggesting it's time to start an agency.)

Regardless of your motivation, starting a business is a big step. Aside from finding the right tools you will also need to understand legal considerations any business owner has to keep in mind.

These legalities include:

  1. Abiding by tax laws which apply to your business.
  2. Ensuring effective and safe hiring of tutors.
  3. Safeguarding yourself and your business.
  4. Creating an  effective and lawful advertising strategy.

You can find out more by reading our blog below!

1. Abiding by tax law

Business Taxes: If you are starting your own tutoring agency it is important to familiar yourself with the tax laws of your country. Depending on your location, as a private business owner you will most likely need to pay some sort of tax, whether that is income tax, corporation tax, sales tax or one a handful of other tax categories. 

As a business, you are responsible for paying your own taxes. It is therefore important to keep up to date tax regulations. You can find lots of resources online which can help with identifying what taxes you will need to pay. We have compiled some of these resources as the end of this article. 

Tax Statement Papers
Tax Statement Papers

2. Recruiting tutors 

Criminal Record Check: Since most tutoring agencies work primarily with children it is important to make sure all tutors you employ have sufficient background checks. In the UK that law states that anyone working unsupervised with children must undergo a enhanced DBS check. This check searches for any criminal record a person might have. While it is not legally required to undergo this process if a person is supervised while working with kids, most agencies highly recommend doing so. 

Laws will likely vary depending on which country you are located in, but in general most places require some check for a person's criminal history when working with children. Checking a tutor’s criminal record is also a great way to  ensure your students and business is safeguarded.

Tutor Contracts: A second step to help safeguard your business is to create clear terms of engagement with all tutors. Having a clear understanding of what each tutors role is, what rules they have to follow, and what happens if they do not meet the standards of your business are all important points to consider. 

Some things you may want to think about when writing a contract for tutors include:

  • Is there an ensured number of hours a tutor will teach?
  • Do you want to include certain rules regarding lateness or lesson cancellation?
  • What are your expectations for how tutors represent your brand?
  • How often do your tutors get paid?
  • What circumstances warrant termination?

3. Safe guarding yourself and your business

Terms and Conditions: Making sure that you have clear, precise and well thought out terms and conditions is key to limiting your business’ liability. Good terms and conditions will not only limit this liability if you are ever taken to court but also give your clients a useful resource for understanding their relationship with your business. This document can also be useful to make sure clients understand your exact terms or service and offerings. While terms and conditions are not a legal requirement, they are highly recommended to be used. 

We have linked a number of resources to help you with your terms and conditions at the end of this blog.

Property Insurance: While this is not necessary, many small businesses will choose to ensure their business’s property, such as computers or tools used to teach. Wherever you are choosing to teach, your equipment is at risk of being damaged. Insurance can help keep your business safe.

Professional Indemnity Insurance: This step is again optional. Sometimes also referred to as professional liability insurance, this insurance can help cover legal costs or other charges if your business is alleged to provide inadequate service or advice.

Man working on desk with papers, phone and computer.
Man working on desk with papers, phone and computer.

4. Advertising your Agency

Ensure your advertising is correct: In most countries there are laws prohibiting false advertising. Therefore it is important that any claims you make in promotional posts are correct. Make sure to double check things like tutor skills and qualifications. By ensuring that you see evidence for any qualifications, you can ensure you aren’t accidentally falsely advertising your service.

You can be positive and promote the pros of your agency, but make sure your claims are based on fact. If you are a little lost about where to start with advertising your business you can find some resources below!

Some Interesting Resources

Small business tax advice UK: https://smallbusiness.co.uk/five-taxes-you-should-know-about-when-running-a-small-business-2488866/

Small business tax information US: https://www.usa.gov/business-taxes 

UK Background Check: https://www.gov.uk/government/collections/dbs-checking-service-guidance--2

US Background Check: https://www.lawyers.com/legal-info/labor-employment-law/job-hunting/background-checks-for-people-who-work-with-kids.html

Terms and conditions resources: https://www.theguardian.com/small-business-network/2013/feb/06/terms-and-conditions-small-business

Online Advertising tips:  https://tutorcruncher.com/starting-tutor-business/advertising-tutors-online/

Advertising ideas for small businesses: https://www.simplybusiness.co.uk/knowledge/articles/2018/04/top-small-business-advertising-ideas/

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