How Much Does It Cost to Start a Nursery in the UK? [2026]

Nursery premises must meet strict Ofsted requirements set out in the Early Years Foundation Stage (EYFS) statutory framework. This significantly constrains your property options.

Ofsted premises requirements include:

• Indoor space: Minimum 3.5 square metres per child for under-2s, 2.5 square metres per child for 2-year-olds and over
• Outdoor space: Adequate outdoor play area (Ofsted does not specify a minimum but expects regular outdoor access)
• Toilet facilities: Sufficient for the number and age of children, with changing facilities for nappies
• Kitchen: For preparing snacks/meals, compliant with food hygiene regulations
• Sleep area: Separate, quiet sleep area for under-2s
• Risk assessment: Full premises risk assessment before registration

Lease costs for nursery-suitable premises vary widely. Converted houses, church halls, and ground-floor commercial units are common. Expect £10,000–£30,000 per year in rent depending on location and size.

Fit-out costs typically range from £15,000 to £50,000 and include:

• Child-safe fencing and security (buzzers, CCTV): £2,000–£8,000
• Toilet and changing facilities adaptation: £3,000–£10,000
• Kitchen fit-out or adaptation: £2,000–£5,000
• Flooring (washable, safe, child-appropriate): £2,000–£5,000
• Safety modifications (socket covers, stair gates, radiator guards, window restrictors): £1,000–£3,000
• Outdoor play area (fencing, safety surface, shelter): £3,000–£15,000
• Fire safety and emergency equipment: £1,000–£3,000

Planning permission: Check whether your intended premises has the correct use class. Nurseries fall under Use Class E(f) — non-residential institutions. Change of use from residential may require planning permission and a noise impact assessment.

Nursery equipment must be age-appropriate, safe, and meet British Safety Standards.

Furniture and equipment (£10,000–£30,000):

• Cots and sleep mats: £100–£300 each (budget £1,000–£3,000 for 10)
• Changing tables: £200–£500 each
• Child-sized tables and chairs: £300–£800 per room
• Storage units and book shelves: £500–£1,500
• Buggies and outdoor equipment: £500–£2,000
• Art and craft supplies: £300–£800
• Construction toys, sensory equipment, role play: £500–£2,000
• Books: £300–£500
• Sand and water play equipment: £200–£500
• Ride-on toys and outdoor play equipment: £1,000–£5,000
• Highchairs and feeding equipment: £300–£800

Technology:

• Nursery management software (Famly, ParentMail, Tapestry): £50–£200/month
• CCTV system: £500–£2,000
• Intercom/buzzer entry system: £200–£500
• Tablets for learning journals: £200–£600 per room

EYFS resources: The Early Years Foundation Stage framework requires specific learning areas to be resourced — communication and language, physical development, personal/social/emotional development, literacy, mathematics, understanding the world, and expressive arts. Budget comprehensively across all seven areas.

Ofsted registration is mandatory for any childcare provision caring for children under 8 for more than 2 hours per day. You cannot open without it.

Registration costs:

• Ofsted registration fee: £220 (Early Years Register)
• If also registering on the Childcare Register (for children 5-7): additional £220

Ofsted registration requirements:

• The registered person (you or your manager) must have an enhanced DBS check
• At least one Level 3 qualified practitioner on site at all times
• A manager with at least a Level 3 qualification (Level 5 or above preferred by Ofsted)
• All staff must have paediatric first aid training (renewed every 3 years)
• Policies and procedures covering safeguarding, behaviour management, health and safety, complaints, data protection, and SEND
• Full risk assessments for all areas and activities

Safeguarding training: All staff must complete Level 1 Safeguarding Awareness training as a minimum. The Designated Safeguarding Lead must complete Level 3. Budget £50–£200 per person for training courses.

Food hygiene: If providing meals or snacks, at least one person must hold a Level 2 Food Hygiene certificate. Cost: £25–£50 per person.

Ofsted inspections: After registration, Ofsted will inspect within 30 months, then typically every 4 years. Inspections are unannounced. Ratings: Outstanding, Good, Requires Improvement, or Inadequate.

Total Ofsted registration and compliance setup: £500–£2,000.

Every person working in a nursery — including volunteers and students — must have an enhanced DBS check with barred list check before they start.

DBS check costs:

• Enhanced DBS check: £38 per person (standard fee)
• DBS Update Service (annual subscription to keep checks current): £13 per year per person
• Some umbrella bodies offer discounted checks — check with the Pre-school Learning Alliance or National Day Nurseries Association (NDNA)

For a nursery with 8–10 staff, budget £300–£500 for initial DBS checks.

Additional vetting requirements:

• References from all previous employers, particularly those involving work with children
• Verification of qualifications (originals, not copies)
• Health declaration / fitness to work with children
• Right-to-work check (mandatory for all employees in the UK)
• Disqualification declaration (Childcare Disqualification Regulations 2018)

Overseas staff: Individuals who have lived or worked abroad for 3+ months in the past 5 years need a Certificate of Good Conduct (or equivalent) from the relevant country, in addition to the UK DBS check.

Ongoing DBS management: DBS checks do not expire, but Ofsted expects nurseries to re-check staff regularly. The DBS Update Service (£13/year per person) allows you to check for new information without running a full new check.

Staffing is the largest ongoing cost in a nursery, and the EYFS framework mandates strict staff-to-child ratios.

Mandatory Ofsted ratios (England):

• Under 2 years: 1 staff member to every 3 children (1:3)
• 2-year-olds: 1 staff member to every 4 children (1:4)
• 3 to 5-year-olds: 1 staff member to every 8 children (1:8), or 1:13 if a qualified teacher is present

Qualification requirements:

• At least half of staff must hold a Level 2 qualification (or above)
• At least one member of staff must hold a Level 3 qualification in each room/ratio group
• The nursery manager should hold a Level 3 minimum (Level 5 preferred)

Typical salaries in 2026:

• Nursery manager (Level 5+): £26,000–£35,000
• Room leader (Level 3): £23,000–£28,000
• Nursery practitioner (Level 2/3): £21,000–£25,000
• Nursery assistant (Level 2): £20,500–£22,000 (NMW for 21+ is £12.21/hour = £21,353 pa)
• Apprentice: £13,200 (apprentice NMW £7.55/hour)

Employer costs:

• Employer NI: 15% on earnings above £5,000. For a practitioner on £23,000, that is £2,700 per year.
• Pension auto-enrolment: 3% minimum employer contribution.
• Holiday pay: 5.6 weeks minimum statutory entitlement.

Use the Employer Cost Calculator to calculate your total staffing bill.

Example staffing scenario — 30-place nursery (6 under-2s, 8 two-year-olds, 16 three-to-fives):

• Under-2s room: 2 staff (1:3 ratio)
• 2-year-old room: 2 staff (1:4 ratio)
• Pre-school room: 2 staff (1:8 ratio)
• Manager: 1 (supernumerary)
• Cover staff: 1 Total: 8 staff. Annual salary cost (excluding employer NI and pension): approximately £175,000–£200,000.

First-year staffing costs may be lower if you open with fewer children and scale up. Budget £15,000–£50,000 for the startup period before reaching full occupancy.

Nursery insurance is specialist and must cover the unique risks of working with young children.

Employer's liability insurance: Legally required. Minimum £5 million cover. Cost: £150–£400 per year.

Public liability insurance: Covers injury or damage claims from parents, visitors, and children. Essential. Cost: £300–£800 per year for £5–10 million cover.

Professional indemnity insurance: Covers claims arising from the care and education you provide. Cost: £100–£300 per year.

Contents insurance: Covers equipment, furniture, and resources. Cost: £200–£500 per year.

Abuse liability insurance: Specialist cover for allegations of abuse — essential for any childcare setting. Often included in nursery-specific insurance packages.

Business interruption insurance: Covers lost income if you are forced to close (e.g., Ofsted suspension, fire, flood). Cost: £100–£300 per year.

Total nursery insurance: £1,000–£3,000 per year. Specialist providers include Morton Michel, NurseryPlan, and Ecclesiastical.

Nursery marketing is primarily local and reputation-driven. Parents choose nurseries based on Ofsted rating, word of mouth, location, and visits.

Launch budget: £1,000–£3,000

• Branding: Logo, colour scheme, and nursery name. Budget £300–£800.
• Website: Essential for credibility — include your Ofsted number once registered, photos (with consent), fees, curriculum information, and virtual tour if possible. Budget £500–£1,500.
• Google Business Profile: Free and critical for "nursery near me" searches.
• Local advertising: Leaflets to local parent groups, children's centres, GP surgeries, and libraries. Budget £200–£500.
• Social media: Facebook is the primary platform for nursery marketing in the UK. Parenting groups and local community pages drive referrals.
• Open days: Pre-opening open days to show parents the setting. Budget £100–£300.
• Signage: External signage at the premises. Budget £200–£500.

Government-funded places: Registering to deliver the 15-hour and 30-hour funded entitlements for 2, 3, and 4-year-olds is a major marketing advantage. Contact your local authority early years team to register as a funded provider. The funding rate varies by local authority but is typically £5.50–£8.00 per hour per child.

Waiting lists: Many areas have high nursery demand. Start building a waiting list before you open.

Nurseries fill up gradually. It typically takes 6–12 months to reach full occupancy, and you need working capital to cover costs during this period.

Monthly operating costs for a 30-place nursery:

• Rent: £1,000–£2,500
• Staffing (fully staffed): £14,000–£18,000
• Utilities: £300–£600
• Food and consumables: £500–£1,000
• Insurance: £85–£250
• Software and admin: £100–£300
• Cleaning and maintenance: £200–£400
• Training and CPD: £100–£200

Total monthly costs: approximately £16,000–£23,000 at full staffing.

Revenue at full occupancy: 30 children paying an average of £60/day for 5 days/week generates approximately £36,000–£39,000 per month. Government funded hours bring lower revenue per hour but guaranteed occupancy.

Budget £10,000–£30,000 in working capital to cover the ramp-up period. The first 3–6 months are critical — you may be at 50–70% occupancy while carrying near-full staffing costs (because ratios must be maintained regardless of occupancy).