Ask an accountant: beauty
The questions salon owners and chair renters actually ask, answered the way they would be answered on a call: the short answer first, then why, then the free tool if there is one. Rates are those applying in 2026/27.
24 questions, answered plainly
Both, for different chairs. The demo week: the salon keeps £484 from an employed column and £150 from a rented chair, but the rent carries no wages, product, holiday or quiet-week risk. The calculator runs both sides on your numbers; the mix is a portfolio decision, not a doctrine.
Control sitting with the renter: their prices, their hours, their clients, their money arriving directly, a fixed rent invoiced and chased. HMRC reads the room, not the agreement, so the room has to match the paper.
It can, and it should usually not be: percentage rents read as profit sharing and drift the arrangement toward employment. A fixed rent reviewed annually holds the line, and the register proves it behaved like rent.
The demo stylist keeps £1,057 a week renting against £560 employed, before their own tax, National Insurance, insurance and empty Tuesdays. Bigger and riskier against smaller and safer, which is the honest way to present it to both sides.
Yes: chair rental is standard rated, and has been since the 2012 change. A registered salon adds VAT to the invoice, and the rent counts toward the salon's own threshold arithmetic as taxable income.
Because per hour it probably is. The demo £96 colour earns £13.87 an hour against the £52 cut's £30.08 once minutes, product and the chair share are priced. Rank the menu by margin per hour and reprice the bottom rows first.
The rate plus roughly 29 per cent: holiday accrual, employer NIC and pension. The demo £14.00 costs £18.06 loaded, and every price on the wall should be built from that number, not the headline.
Spread the room's overheads across every chair and open hour: £5.50 in the demo salon. Long treatments carry more of the room, which is exactly why they mislead when priced by ticket instead of by hour.
After VAT, cost and any stylist commission, the demo bottle nets £4.63, exactly 30 per cent. Rank the shelf by that line, restock the winners, and question anything under 25.
Normal for experienced stylists, and it pays £585 against £560 basic on the demo takings: more in good weeks, less in quiet ones. The floor check runs underneath every week regardless, averaged on hours worked.
The demo diary loses £345 a week, £17,940 a year, at just 5 per cent of appointments. Deposits recover a slice, and their real work is deterrence: the rate falls the day card details are taken. Kept deposits keep their VAT.
Not yet: they are cash in and service owed, a liability until redemption. The demo drawer holds £7,380 of service owed and £1,620 of likely breakage, recognised on a written policy. December that sells promises must fund the January that keeps them.
Yes: a kept deposit keeps its VAT, because it remains payment for the supply you stood ready to make. £15 kept banks £12.50. The till and the bookkeeping template should both know the rule.
Services against retail, card against cash, employed takings against chair rent, every week. Those four splits make the VAT return, the payroll reconciliation and the year end mechanical.
All of it: services, retail and chair rent are all taxable turnover, with no outside-the-scope corner. The rolling twelve-month test is checked monthly, and the demo two-chair studio holds just £6,800 of headroom.
That is disaggregation, and HMRC checks salons for it by name: shared premises, tills, staff or branding let them direct the parts to be treated as one, VAT backdated. Genuinely separate businesses exist, but the bar is high and the paper is not the test.
Registration from the first day of the second month after the breach, VAT on everything the till rings, and margins that need repricing rather than absorbing. Cross deliberately: menus repriced in advance land better than emergency ones.
No: their takings are their turnover, one more line of evidence that two businesses share the room. Your threshold counts your services, your retail and the rent they pay you.
The local-authority special treatments licence where your council requires one, TheMusicLicence for the playlist, employer registration before the first payday, and display of the employers' liability certificate. The opening checklist runs the order.
Employers' liability at £5 million from the first employee is the legal one. Public liability and treatment risk are the commercially essential pair, with every menu treatment listed and patch tests done, and renters carrying their own.
Count it weekly at cost: opening plus purchases less closing, divided by services, against your standard. The demo cupboard runs £1.10 over per service, £46 a week, invisible until counted.
The demo room runs 80 per cent booked and 75 billed against available hours, and the two gaps are the plan: marketing and menu fill the first, deposits and reminders the second. Measure per chair, weekly.
Rarely at the start: sole trader with a tax reserve habit covers the first years, and the company question is priced properly on sustained profits. The freelancer hub carries the calculator when the time comes.
Four counts and three decisions: stock at cost, the voucher drawer, deposits held and the rent ledger; then prices against the per-hour ranking, the chair mix and the kit through the annual investment allowance. One folder, one calm February.
No question matches that. Try a shorter word, or ask us directly and it gets added.
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