Here’s a few simple steps on how to start and run a business from home
Who you must tell if you want to start a home based business
- Your mortgage provider or landlord. Starting or running a small business from home may be against the terms of your mortgage or tenancy so this should be one of the very first things to check.
- Your home insurance company. Check your home contents insurance to see if it covers business equipment in a home office, if not you’ll need to get separate business insurance. Get quotes and compare prices for home office insurance here.
- Your local planning office, probably only necessary if you’re planning major alterations or if your home is going to be ‘taken over’ by the business to the extent that it’s no longer a residential property.
- Your local council especially if you’re going to get lots of customers or deliveries to your home, or you’re going to make lots of noise, or smells(!)
Tax Allowances if you’re running a home based business
If you’re running a business from home you can claim for a proportion of your council tax, heating, lighting etc. as business expenses when you complete your tax return.
Or, for sole traders only, use these flat rate working from home calculations instead.
Think carefully about dedicating one or more rooms solely to your business. If you do you may have to pay business rates rather than domestic rates on those rooms, and if you sell your house and it’s gone up in value you may have to pay capital gains tax on the proportion that’s dedicated to your business.
Advantages of running a business from home
- You don’t spend time or money travelling to the office
- It’s effectively rent free
- It’s convenient – you have all the tools and equipment you need close at hand
- It allows you to balance your business with family commitments
- It gives you flexibility over how you use your time
Disadvantages of running a business at home
There are lots of advantages of running a business from home but you should consider the disadvantages too, and ensure it really is a viable option for you:
- You need to create a dedicated workspace with enough room, heat and light to be comfortable
- Home working will intrude on your home life if you let it
- Paperwork needs to be contained so it doesn’t take over your house
- It can be hard to ‘switch off’ in the evenings and at weekends
- It’s a solitary existence so you may feel isolated and lonely
- You’ll need to ‘train’ your family so they don’t disturb you when you’re working, especially when you’re on the phone!