Financial Forecasting for CQC Registration: The Part Nobody Prepares For
Why applications stall on the numbers, and what CQC actually wants to see
Most people preparing a registration application expect the hard parts to be the statement of purpose and the fit person interview. They read up on safeguarding. They rehearse how they would handle a medicines error.
Then they reach the financial section and discover they are being asked for something they have not prepared at all.
This is one of the two things I am seeing providers get stuck on most often at the moment, and it is almost always because nobody warned them it was coming.
First, two things that get confused
There are two separate financial requirements and people routinely mix them up. Getting the distinction clear saves a great deal of wasted effort.
The financial viability statement. This sits under Regulation 13 of the Care Quality Commission (Registration) Regulations 2009. It is a letter signed by a financial specialist — an accountancy firm, a bank, or a financial services firm — confirming your financial standing. CQC publishes a template. It cannot be signed by a friend or a relative, and your application will not be approved until CQC has that assurance.
Some providers are exempt: NHS trusts, local authorities, adult social care providers in the Market Oversight Scheme, and organisations holding NHS contracts.
The business plan and financial forecast. This is a different document entirely, and it is yours to write. It is required for home care agencies, supported living services and, from August, ambulance services.
Worth noting: residential care homes are not on that list. If you are registering a care home, check the supporting documents list for your service type rather than assuming.
You may need both. They do different jobs.
What the business plan must actually contain
CQC's guidance is more specific than most applicants expect. Your plan must include:
A summary of the plan
Background on your company and your management team's experience
Details of your service — what you provide, how, for whom, and why it will succeed locally
Market research
A named person responsible for each significant task
Your ownership and company structure, including investors
Financial forecasts
And then the line that catches people out:
"If your plan does not include enough detail your application may not be successful."
That is not a warning about tone. It is the actual reason applications get returned.
The monthly breakdown
For home care and supported living services, CQC asks for a monthly breakdown of income and expenses for your first 12 months of business.
Monthly. Not annual. Not a headline turnover figure with a margin assumption underneath it.
That means, for each of twelve months, you need to have thought about what is coming in and what is going out. Wages, including what you will actually pay staff. Employer's National Insurance and pension contributions. Recruitment and DBS checks. Training, including the statutory learning disability and autism training. Insurance. Mileage and travel time. Software. Rent. Your CQC fee. PPE. Accountancy.
And on the income side, a realistic picture of package growth, not a straight line from zero to full capacity in month three.
Pricing, and why they ask
If you are a home care or supported living service, CQC also wants your pricing structure in detail:
Will you charge by the hour, by 45 minutes, by 30 minutes?
What do you charge for evenings and bank holidays?
Do you charge local authorities and private clients the same?
What do you charge for double-handed calls?
Alongside this, your market research must show how you arrived at your pricing and your staff pay.
That last part is the point of the whole exercise, and it is worth understanding properly. CQC is not assessing whether you will be profitable. It is assessing whether your numbers describe a service that can be delivered safely.
If your hourly rate does not support paying carers properly, covering travel time, and funding training and supervision, then the plan describes an unsafe service — regardless of how healthy the bottom line looks. A forecast that only works because staff are underpaid is not a viable business plan. It is a risk assessment nobody has written down.
What I am seeing in practice
Two things beyond the published requirement.
Forecasts being asked to go further than twelve months. The published guidance says twelve. In practice I am seeing applicants asked to demonstrate a longer view of sustainability, and I would rather a client had thought beyond year one than be caught out mid-application. If you have the numbers for years two and three, include them.
Questions about actual spending and contingency. Not just projections, but what you have already committed and what resources sit behind the business if income arrives more slowly than planned. What happens if package growth takes nine months instead of four? What are you living on? Who is funding the gap?
That question is the one people least expect and answer worst. "We will manage" is not an answer. A named reserve, a facility, an investor commitment, a realistic personal position — those are answers.
The mistakes I see most
Round numbers. A forecast built on £5,000 here and £10,000 there tells anyone reading it that the figures were estimated rather than calculated.
Income that starts too high. Almost every first forecast I review assumes packages arrive faster than they do. Build the slow version, then show you can survive it.
Numbers that contradict the statement of purpose. If your plan describes forty hours a week and your statement of purpose describes a service that clearly needs more, the pack contradicts itself. Applications are read as a whole.
No wage detail. Staff costs are the majority of your expenditure. A forecast that does not show what you will pay, at what rate, with on-costs, is not finished.
Leaving it last. It is the section people write at 11pm the night before submitting, and it shows.
How I would approach it
Write it before you write anything else, not after. The financial forecast is where your service model meets reality, and it will tell you whether the thing you are describing is actually deliverable. Better to find that out now than after you have signed a lease.
Get an accountant involved early. Not for the viability statement — if you are registering a home care or supported living service you are exempt from that — but because building a monthly forecast that stands up to scrutiny is a great deal easier with someone who does it for a living.
Then read your forecast alongside your statement of purpose and ask one question: do these two documents describe the same service?
If the answer is no, fix it before CQC finds it.
Tiffany Nelson supports adult social care providers in England with CQC registration and inspection preparation. If you are preparing an application and want your business plan and forecast reviewed before you submit, get in touch, see how I can help here.
Sources: Care Quality Commission (Registration) Regulations 2009, Regulation 13; CQC guidance, Supporting documents: new provider registration applications — business plan and financial forecast (page last updated 10 August 2026); CQC, Statement of financial viability: letter template and guidance on assessing financial viability at registration.