Starting a care agency looks simpler than opening a care home: no building to buy, no beds to fill, and demand that keeps rising. In practice, agencies that fail usually do so in the first two years, for predictable reasons: registration takes longer than planned, the first contract does not arrive, staff are hard to keep, or pay and travel costs eat the margin. This guide sets out the decisions and steps for starting a care agency in England that will still be standing in year three, whether you want to provide home care visits or supported living.
The short answer
If your agency will help people with personal care, such as washing, dressing, eating or taking medicines, you must register with the Care Quality Commission for the regulated activity 'personal care' before you start. You need a legal entity, a nominated individual, a registered manager with the right experience and qualifications, a statement of purpose, policies and procedures, insurance, safe recruitment, and a realistic financial plan that covers several months of running costs before income arrives. Decide early whether you are a domiciliary care agency, a supported living provider or both, because the commissioning, staffing and records are different. Talk to local commissioners before you register, not after.
Domiciliary care or supported living?
Both register for personal care, but they are different businesses:
| Domiciliary care (home care) | Supported living | |
|---|---|---|
| Who | Mostly older people living in their own homes | Mostly people with a learning disability, autism or mental health needs living in their own tenancy |
| Pattern of support | Short visits, often 15 to 60 minutes, several times a day | Longer blocks of support, often shared hours, sometimes 24-hour or one-to-one |
| Main commissioner | Local authority adult social care, plus self-funders | Local authority learning disability and mental health commissioning, sometimes with NHS funding |
| Biggest cost pressure | Travel time and mileage between visits | Sleep-ins, waking nights and high staff ratios |
| Key systems | Rostering with travel, electronic call monitoring | Support hours against funded packages, tenancy-aware records, PBS |
| Housing | Not your concern | Separate from care: a landlord or housing provider holds the tenancy |
In supported living, the housing and the care must be genuinely separate. If the same organisation controls both, and people cannot choose a different care provider without losing their home, CQC may treat the service as a care home. Get this right from the start. Our supported living page explains how records differ from a care home.
Step 1: do you need to register?
You need CQC registration if you provide personal care to people in their own homes. Personal care means physical help with tasks such as washing, dressing, eating, toileting and medication, or prompting and supervising those tasks for someone who cannot do them alone. An agency that only provides companionship, shopping or cleaning does not usually need to register, but most agencies drift into personal care quickly, and providing it without registration is an offence. If in doubt, register.
Step 2: set up the business
Most agencies register as a limited company. CQC registers the legal entity, so decide the structure before applying: changing it later usually means a new registration.
The company needs a nominated individual, usually a director, who is responsible for supervising the management of the regulated activity. They must pass the fit and proper persons requirements, including an enhanced DBS check.
Step 3: the registered manager
Every regulated service needs a registered manager. CQC will interview them and assess whether they can run the service you describe. In practice CQC looks for relevant management experience in social care, a good understanding of the regulations, and either a Level 5 Diploma in Leadership and Management for Adult Care or a commitment to complete it.
If you are the owner and plan to be the registered manager yourself, be honest about your experience. If you have not managed a regulated service, employing an experienced registered manager from day one is usually the difference between a smooth registration and a refused one. Our guide on what CQC asks staff and managers gives a sense of the interview.
Step 4: the statement of purpose and policies
The statement of purpose says who you are, what regulated activities you provide, who you support, where, and how. CQC uses it to judge your application and later inspections, so it must match what you will actually do.
You will also need policies and procedures that fit your service, not a generic pack with another company's name crossed out. At minimum: safeguarding, medicines, recruitment, complaints, infection prevention, consent and the Mental Capacity Act, lone working, record keeping and data protection, whistleblowing, incident reporting, and business continuity. Our policies and procedures list is written for care homes but most of it applies to agencies.
Step 5: apply to CQC
The application covers the provider, the nominated individual, the registered manager and the location (usually your office). CQC will check DBS certificates, references and finances, interview the registered manager, and may visit. Registration commonly takes several months, and longer if the application is incomplete or the manager is new to the role. Budget for that time: you will be paying rent, insurance and possibly a manager before you can provide any care.
CQC charges an annual registration fee, which for community social care providers is set by the number of people supported. Check the current fees scheme when you plan your budget.
Step 6: insurance and finances
- Employers' liability insurance is a legal requirement once you employ staff.
- Public liability and professional indemnity insurance are standard and are usually required by commissioners.
- Working capital: local authorities often pay in arrears, sometimes 30 days or more after the month ends, while you pay staff weekly or monthly. Plan for at least three to six months of costs before income settles.
- Pay rules: in domiciliary care, time spent travelling between visits counts as working time for the National Minimum Wage. Agencies that pay only for contact time can fall below the legal minimum, and HMRC enforces this. In supported living, sleep-in and waking night arrangements have their own rules. Our guide to care payroll and sleep-ins explains both.
Step 7: recruit safely
Your first staff set the culture. Recruit fewer people well rather than many people quickly. Every worker needs an enhanced DBS check with a barred list check, references, a full employment history with gaps explained, right to work checks, and an induction covering the Care Certificate. Our guides to the Care Certificate and mandatory training set out what new workers need.
Overseas recruitment rules for care workers changed significantly in 2025, closing the main care worker visa route to new overseas recruitment. If your plan relies on sponsoring workers from abroad, check the current Home Office rules before you build it into your business plan.
Step 8: win your first work
Registration does not bring clients. Most agencies get their early work in one of three ways:
- Self-funders and direct payments. People who arrange their own care, often found through local word of mouth, GPs and community groups.
- Spot purchasing. The local authority buys individual packages from registered providers, often when framework providers cannot cover.
- Frameworks and tenders. Councils run procurement exercises to appoint providers to a framework. These open at set times and have quality and price criteria. A new agency may not meet every requirement at first, but should know when the next one opens.
Meet commissioners early, ideally before registration. Ask what gaps they have, by area and by type of need. An agency that can cover a rural patch or support people with complex learning disabilities in a gap the council cannot fill will get work faster than one offering the same as everyone else.
Step 9: systems from day one
Paper care records in an agency are harder than in a care home, because the records live in people's homes and the office cannot see them until someone brings them in. A digital system from the start means notes are written at the time, medicines are recorded properly, the office sees what happened today, and the evidence for CQC's first inspection is already there.
Domiciliary agencies usually need rostering with travel and electronic call monitoring to show commissioners that visits happened. Supported living providers need support hours recorded against funded packages and records built around the person's tenancy. Our comparison of domiciliary and supported living software explains the difference.
Running a care agency: the first two years
The agencies that survive share some habits. They grow at the pace their management can supervise. They track staff turnover monthly and treat it as a warning light. They price contracts so the true cost, including travel, training, supervision and management, is covered, and they walk away from work that loses money. They prepare for the first CQC inspection from the first day, because the first rating follows the agency for years.
Worked example: a supported living start-up
An experienced deputy manager from a learning disability home sets up a supported living agency with a business partner. Before registering, they meet the council's learning disability commissioner, who says the area is short of providers for young adults leaving children's services with autism and behaviour that challenges.
They form a limited company, the deputy becomes the registered manager and starts her Level 5 diploma, and they write a statement of purpose for that group specifically. Registration takes five months, which their budget allowed for. Their first package is one young man moving into a shared house run by a housing association, with a transition plan agreed with the community team. Within a year they support eight people in three houses, all through the same commissioner, because the first transition went well.
Common mistakes
- Providing personal care before registration.
- Underestimating how long registration takes.
- No working capital for the months before income arrives.
- Paying only for contact time, so travel pushes pay below the minimum wage.
- A generic policy pack that does not match the service.
- Registering first and talking to commissioners afterwards.
- Growing faster than the registered manager can supervise.
- Housing and care not properly separated in supported living.
What good looks like at the first inspection
The inspector finds a registered manager who knows every person supported, records written at the time with medicines accurately signed, staff who were recruited safely and inducted properly, supervisions on schedule, and a statement of purpose that matches what the agency actually does. Commissioners and families say the agency turns up, communicates and does what it promised. If you are planning a supported living service and want to see records built around tenancies and funded hours, book a demo.
Final conclusion
Starting a care agency is a regulated business, a staffing business and a cash-flow business at the same time. Decide clearly what kind of agency you are, register properly with an experienced registered manager, plan for months without income, pay people lawfully for all their working time, talk to commissioners first, and put good systems in from day one. The agencies that do this are the ones still growing in year three.
Frequently asked
Do I need to register with CQC to start a care agency?
Yes, if you will provide personal care, such as help with washing, dressing, eating, toileting or medicines, to people in their own homes. Agencies that only provide companionship or domestic help usually do not, but providing personal care without registration is an offence.
How long does CQC registration take for a care agency?
Commonly several months, and longer if the application is incomplete or the registered manager is new to the role. Budget for running costs during that time.
What qualifications does a registered manager need?
CQC looks for relevant social care management experience, good knowledge of the regulations, and a Level 5 Diploma in Leadership and Management for Adult Care or a commitment to complete one.
What is the difference between domiciliary care and supported living?
Domiciliary care provides short visits to people, mostly older adults, in their own homes. Supported living provides longer blocks of support to people, often with a learning disability, autism or mental health needs, who hold their own tenancy, with housing and care kept separate.
Do care workers have to be paid for travel time?
Time travelling between visits counts as working time for National Minimum Wage purposes. If pay is calculated only on contact time, average pay can fall below the legal minimum.
How does a new care agency get its first clients?
Usually through self-funders and people using direct payments, local authority spot purchasing, and later framework contracts. Meeting commissioners early and offering something they are short of helps most.
Sources
- Care Quality Commission: registration guidance for providers and registered managers
- Health and Social Care Act 2008 (Regulated Activities) Regulations 2014, schedule 1 (personal care)
- CQC: Right support, right care, right culture, and supported living guidance
- GOV.UK: National Minimum Wage, calculating working time including travel
- Skills for Care: guidance for new providers and registered managers
- Employers' Liability (Compulsory Insurance) Act 1969
