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Hi there, and welcome!
1. If you are doing private in-home daycare, then no, you do not need any sort of license. You can care for 5 children NOT including your own 2, (I believe Reggio meant to word it that way)
2. My families pay in advance, every 2 weeks. I charge for STAT holidays but I DO NOT charge when I take a vacation or sick day. (Some daycare providers charge for both their sick days and holidays) If they choose to keep their kid home for Christmas break, and I am open, they still pay. Same goes for summer or March breaks. Again, you are the boss, and can decide if you want to do it this way or not.)
3. If you are going to run privately, then you do not need any regulation rules or forms. HOWEVER, you should look into developing a contract. This will be soemthing both you and the [parents sign stating the rate they will pay, how often, late pmt fees, chage for stat holidays, sick policy (you dont want them sending you their sick kid to care for all day!). PM me for a copy of my contract I created.
Lastly, you are obligated to issue receipts to parents at year end for tax purposes, because you do this, you are eligible to claim portions of your utility bills, food, craft supplies, toys, equipment etc.
The going rate depends on your area. I am in Kingston and I charge $32 per kid per day. Mississagua area could be higher, or lower, depending on the demand.
Good Luck! hope this helps!
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