If you are thinking about renting your spare room or employing your first therapist, start with this number. A full-time therapist on the National Living Wage costs about £28,300 a year in 2026, once employer National Insurance and pension are added. A room renter costs you nothing in wages and pays you rent instead.

That gap is the whole decision. Employing gives you the profit from every treatment she does, and the cost of every quiet day. Renting gives you a steady rent, and no say over how she works.

This page is general information about the UK rules, with every rate taken from GOV.UK. It is not legal or tax advice. Check your own situation with an accountant or an HR adviser, or call Acas, before you sign anything.

What an employed therapist costs in 2026

The worked example below is illustrative. It assumes one therapist aged 21 or over, working 37.5 hours a week, paid the National Living Wage.

A few things change that total:

• Employment Allowance. If your business is eligible, it reduces your employer national insurance by up to £10,500 a year (GOV.UK). For a first hire, that can cover the £2,968 in full. A limited company whose only employee is its single director cannot claim it.
• Holiday is already inside the wage figure. She is entitled to 5.6 weeks' paid holiday a year, which is 28 days for a five-day week (GOV.UK). You pay for those days and take no treatment income from them.
• Sick pay. Statutory Sick Pay for 2026 to 2027 is £123.25 a week, or 80% of her average weekly earnings if that is lower (GOV.UK).
• Experience. The National Careers Service puts beauty therapist pay at £23,000 for a starter and £29,000 for someone experienced. An experienced therapist will expect more than the minimum.
• Younger staff. The minimum rate is £10.85 an hour at 18 to 20, and £8 for under-18s and apprentices (GOV.UK).

Add your own costs on top: products and consumables for her treatments, training, uniform, her share of booking software and the employers' liability insurance covered below.

Rent a room or employ: the costs side by side

Pros and cons of renting out a room

The benefits:

• A fixed income from space you are not using.
• No wages, no employer national insurance and no pension, provided the arrangement is genuine self-employment.
• No responsibility for filling her diary.
• Less management. She runs her own business.

The drawbacks:

• Your income from the room never rises above the rent.
• Her clients belong to her. If she leaves, they usually go with her.
• You cannot tell her when to work, what to charge or which products to use without changing her employment status.
• Her standards sit under your salon's name, and you have limited control over them.

Renting suits an owner who wants the room covered and has no time to manage anyone.

Pros and cons of employing a therapist

The benefits:

• The profit from her treatments is yours, so profitability grows as her diary fills.
• You set the treatment menu, the prices, the products and the standard.
• The clients belong to your business and stay with the salon.
• She can take treatments off your hands, which is how an owner starts to step back.

The drawbacks:

• You pay her whether the diary is full or not.
• You take on employer responsibilities: payroll, national insurance, pension, holiday, sick pay and insurance.
• Recruitment, training and management take your time, especially in the first months.

Employing suits an owner with more demand than she can handle, who wants the business to grow beyond her own hands.

Which one should you choose?

Work out what her treatments would bring in on a realistic week, and take off products and her share of your costs. If what is left is comfortably above the employment cost in the table, and your diary is already turning people away, employing usually makes more money. If the room would sit half-empty, renting is the safer income.

Employment status: what HMRC looks at

Calling someone self-employed does not make her self-employed. GOV.UK says employment status depends on the actual working practices, whatever either side calls the arrangement.

HMRC's guidance for hair and beauty asks four questions:

• Who sets the hours? Set by the salon points to employment. Deciding her own hours points to self-employment.
• Who provides the clients? The salon providing them points to employment. Bringing her own points to self-employment.
• Who provides the products? The salon deciding what to use points to employment.
• Who sets the prices? A rate set by the salon points to employment. Deciding what she charges points to self-employment.

According to the same guidance, a self-employed room renter typically pays rent for the space, keeps her own client records and bookings, buys her own products and equipment, and sets her own hours and prices.

If a room renter works like an employee in practice, HMRC can treat her as one. The salon could then owe income tax and national insurance that should have been deducted. GOV.UK warns that individuals and their employers may have to pay unpaid tax and penalties if employment status is wrong.

HMRC's hair and beauty guidance also notes that someone who is self-employed for tax can still have worker status under employment law, which carries some employment rights. Acas gives free, impartial advice if you are unsure.

HMRC's Check Employment Status for Tax tool helps both sides check. If you rent out a room and you are VAT registered, HMRC's hair and beauty guidance says the rent goes on your VAT return.

If you employ: the first-hire checklist

GOV.UK and Acas set out what an employer must do. For a first therapist, it comes down to seven steps.

1. Check her right to work. You must check a job applicant is allowed to work in the UK before you employ her, using an online share code, her original documents or an identity service provider. Keep copies for the length of her employment and two years after (GOV.UK).
2. Get employers' liability insurance. You need it as soon as you become an employer, with cover of at least £5 million. You can be fined £2,500 for every day you are not properly insured (GOV.UK).
3. Register as an employer with HMRC. Register before her first payday to get your PAYE reference, and no more than two months before you start paying her (GOV.UK).
4. Give her a written contract. Employees and workers must get a written statement of the main terms on their first day, including pay, hours, holiday and place of work, with the fuller statement within two months (GOV.UK).
5. Pay at least the minimum wage. £12.71 an hour at 21 and over from April 2026 (GOV.UK). The rates change on 1 April each year.
6. Run payroll with PAYE and national insurance. Deduct her income tax and national insurance and pay employer national insurance at 15% above the threshold (GOV.UK).
7. Set up a workplace pension. Your duties start when your first member of staff starts. Staff aged 22 to State Pension age who earn at least £10,000 a year must be enrolled (GOV.UK).

Book her 5.6 weeks of paid holiday into the year's diary from the start, so it never comes as a surprise in a busy month.

Hiring well: job description, qualifications and interview questions

The legal requirements get her in the door. Hiring the right person keeps your clients.

The job description. Write down the treatments she will do, the hours, the pay, and what a good week looks like. Say how she will be expected to sell: rebooking, homecare and add-ons. Acas guidance on advertising a job covers keeping the advert within discrimination law.

Qualifications. The National Careers Service lists college courses and the Beauty Therapist Level 2 and Advanced Beauty Therapist Level 3 apprenticeships as routes into the job. Ask to see certificates for every treatment she will perform, and check your insurer is happy with them.

Interview questions that tell you more than a CV:

• Talk me through a consultation with a new client.
• What do you recommend for homecare after a facial, and how do you bring it up?
• How do you rebook a client before she leaves?
• Tell me about a client who was unhappy. What did you do?
• Which treatments do you most enjoy, and which would you rather not do?

Qualities to look for. Technique can be trained. Look for someone clients will want to come back to: warm, reliable, interested in skin, and comfortable recommending what a client needs. Book a trade test, a real treatment on a model, before you offer the job.

Acas has step-by-step guidance on interviewing job applicants and offering someone a job.

How to step back from the treatment room

Hiring your first therapist is the start of a transition, from service provider to business owner. The order matters, because stepping back too fast is how income falls.

1. Delegate treatments first. Hand over the treatments you enjoy least and that she can deliver to your standard. Keep the ones clients book you for.
2. Write the systems down. Your consultation, your aftercare, how you rebook, how you sell homecare. If it lives only in your head, it leaves with your hands.
3. Train her to sell the way you do. Profitability depends on her rebooking and recommending as well as treating. How to sell without being pushy is in how to make more money from the clients you already have.
4. Measure her diary, not her hours. Track bookings, rebooking and average spend each month, so you know she is paying for herself.
5. Then take time out of your own diary. Only once her column is full and holding.

This is the work in Kat's Clinic Launch Lab, built for owners who "want to step back from the treatment room (without losing income)". Month five is "Operations & Delegation: SOPs, VAs, remote team, what to delegate and how to measure output", and month six is "Step out of the treatment room. Step into the CEO seat."

When neither is right yet

If your own diary is not full at the right prices, neither renting nor employing fixes it. A new therapist needs demand to be waiting for her.

Get your prices and your diary right first. How to price facials in the UK and how to raise your prices are the place to start. Most Scale Up members start solo or with one member of staff, which is the stage Scale Up Society is built for.

Sources

Rates and rules checked on 15 October 2026. Rates change each April.

• GOV.UK: National Minimum Wage and National Living Wage rates
• GOV.UK: Rates and thresholds for employers 2026 to 2027
• GOV.UK: Claim Employment Allowance
• GOV.UK: Workplace pensions for employers
• GOV.UK: Workplace pension contributions
• GOV.UK: Holiday entitlement
• HMRC on GOV.UK: Check employment status if you work in hair and beauty
• GOV.UK: Employment status: self-employed and contractor
• GOV.UK: Check a job applicant's right to work
• GOV.UK: Employers' liability insurance
• GOV.UK: Register as an employer
• GOV.UK: Written statement of employment particulars
• GOV.UK: Rent a room in your home
• GOV.UK: Register for Self Assessment if you're self-employed
• Acas: Recruitment
• National Careers Service: Beauty therapist

"Step back from the treatment room without losing income."

Kat Martyn, mentor.katmartyn.co.uk