The Education Network for Waltham Forest
Supported by Waltham Forest

2. Business Structure

Early Years Foundation Stage

It is recommended that in the beginning you complete a business plan that sets out the aims and objectives of the business and should also include forecasted budgets and cash flow projections. Information on what is available for setting up a business in Waltham Forest can be found here.

What business structure will work best for your out of school club?

When setting up a new business it is also important to think about the structure of your organisation, your business's legal status and to understand the legal responsibilities involved in operating a business.

There are a number of different business legal structures that can be explored when thinking about how you wish to operate your after school club. The main types to consider are:

Sole trader As a sole trader, you run your own business as an individual and you can keep all your business's profits after you've paid tax on them. As a sole trader you can employ staff. A disadvantage to this is that you are personally responsible for any losses your business makes.
Limited Company A limited company is an organisation that you can set up to run your business – it is responsible in its own right for everything it does and it finances are separate to your personal finances. Any profit it makes is owned by the company. The company can then share its profits.

Every limited company has member who are the people or organisation who owns the shares in the company. In addition, Directors are responsible for running the company. In some cases Directors have their own shares, but they don't have to. Directors of a limited company must comply with requirements of Companies House such as submitting annual accounts, holding meetings and maintaining the company's public records. Private limited companies cannot have charitable status.
Registered Charity The club is run by a management committee, formed by a group of volunteers. This may be the best option if you are short of funds, as it enables the committee to apply for grants from charitable trusts and foundations. All members of the management committee have to be DBS checked (if your club is Ofsted-registered) and you must also register with the Charity Commission.
Social Enterprise Social enterprises are businesses trading for social and environmental purposes. Social enterprises are distinctive because their social purpose is absolutely central to what they do: their profits are reinvested to sustain and further their mission for positive change. Social enterprises can use a variety of legal structures including:
- Community interest company
- Company limited by guarantee
- Registered charity
For more information on social enterprises, visit the website for the Social Enterprise Coalition.

Once you have decided what business structure you are going to work under, it is important that you register your business. Information on how to register your business can be found here.

In addition to this the government has produced guidance about setting up a new business.

For more details of the various business structures that you may wish to consider details can be found on the Out of School Alliance website.


1. Establish the need2. Determine the business structure3. Identify sources of funding4. Premises5. Registration with Ofsted6. Staffing and Employment7. Materials and Resources8. Policies and Procedures9. Marketing and Promotion

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Last updated: 
Friday, 27 November, 2015
Last updated: 27 November 2015 by Barry Fong