At the risk of sounding totally mercenary, I think some of your decision on whether or not to take on your Sister in law's child should be based on whether or not she is paying the same rates as your other clients. Can you afford to offer her a "family discount" ? Don't feel badly if you can't - the profit margins in this industry are not huge. =) The other thing to consider, is if her child is in your care, that's one less monkey that you can provide care for - again, something to think about before you offer her free or reduced rate childcare.