Many individuals have business ideas but no means to implement them as they have either, no resources, space, or money to operate, so this is a cost effective alternative. Running a business from home can be challenging, yet it is not impossible if you know how to do it.
So the question is, is it legal to run a business from a rented or council property?
The answer is Yes!
The government and the law are on your side, as a small business you are protected. The Small business enterprise and employment act 2015 states that landlords and councils cannot unreasonably deny you permission to run your business in your rented or council property.
Important factors to know before you start
As any business, you want to make sure you are following the law, especially when it involves your own home. By following the correct procedures, it can be an easy process that protects you to successfully setting up and running your business from home. Failing to do so could lead to your landlord or council denying you permission.
Everything you need to know
- Get written permission
- Does your business disturb your neighbors
- Is it going to cause damages to the property.
- What does your current tenancy agreement say?
- Extra payments – How will you pay for additional bills?
- Have you got business insurance/ licence
- Tax and business rates
Let us break this down for you.
1. Get written permission
First and most importantly, you’ll need to get written permission from your landlord or local council. This can be done by simply contacting the relevant person/ association and informing them of what you intend on doing. For rented properties, you can contact your landlord directly, and for council properties, you can visit your local branch or contact them through their website.
It’s import to know your tenancy agreement may prohibit you from running your business from home, but don’t be disheartened, all you need to do is ask. To find out more about getting permission, go here.
Once you’ve made contact, you will need to fill out a form with the following information:
- Your business agenda, accurate details about what your business does and how it operates
- Changes and requirements to the property required to support your business
- Any extra planned buildings that you want to put up, for example a shed
- Potential impact on neighbours, for instance late opening hours or loud machinery
- Any commercial vehicles that may also cause a disturbance or block driveways and streets into neighbouring homes.
The required information may differ to this example but they are relatively the same. Once completed and you have been given the green light ensure your tenancy agreement is updated to your current situation too. This ensures you are protected in the sense that your landlord or council is aware that you have taken the correct precautions and notified your councils of your business ventures.
2. Does your business disturb your neighbours?
As a business your professional identity is a must, there should be a conscience in how you act and are then perceived. Are you loud as a business? Do you cause inconvenience to your neighbours? Permission might not be granted if your business is likely to cause noise and a disturbance to your neighbours. Make sure you are clear about what your business’s services are and if any inconvenience is caused to your surroundings.
3. Is it going to cause damage to the property?
If the answer is no, you will be smooth sailing into running your business from your home. But if the answer is yes consider if you have to install any equipment to your property in order to run your business and if these requirements may damage the property. For example, hairdressers – will you need to install a sink to run your business? If so, where would it go, do you have space? Do you need to build in the garage or build a garage in order to achieve this? Furthermore, creatives, will your materials damage or stain the property? Causing damage or the liability of this happening will decrease your chances of running your business from home.
4. What does your current tenancy agreement say?
Will your tenancy agreement allow you to run a business? You do not know? Speak to your landlord or local council. In addition, go over the main fixtures of your business to keep your landlord in the loop. For example, they may permit you to run your business if the following criteria is met:
- Minimal to no noise to your neighbours and surrounding area is avoided – be considerate of your working hours.
- Equipment and materials utilised do not damage the property
- Pay and repair for any damages you have caused by running your business
- Only use certain equipment and materials in a particular place, such as a garage, or somewhere that does not cause damage and is easy to clean.
Agree with your landlords on these major adjustments as a starting point. Only you know how much your business needs. Only then can you move forward.
5. How will you pay for additional bills?
Whilst you can work from home, you should also be prepared for the additional cost and expenses that may accumulate from your business.
One way to ensure that you are keeping on top of your bills is to make sure you;
- Pay for additional bills, any extra payments. For example, hairdressers, you may use more water therefore increasing your water bill.
- Talk to your landlord, they may increase the rent to accommodate for any extra bills altogether.
6. Has your business got insurance?
Whether you have a business big or small you should have insurance. It is essential in running a business from home. Not only do you want to protect yourself but your equipment, property, and employees.
Home business insurance is cover for those who run their business from home. For example, if you have customers visit your home or buy a product or service from your home. Moreover, your home insurance can likely cover you but not completely, it is important that you check you have the right insurance for your business. If you are unsure speak to your insurer.
What Business Insurance do you need?
- Public Liability insurance – If you have customers that regularly visit your home – it will cover if someone is injured on your property, damages to your property, and personal injury
- Employee liability insurance – If you have people working from your home, for you – it will cover fees if any employee is trying to sue you.
- Commercial property insurance – This covers the cost of repairing and rebuilding your business premises and or replacing stock and equipment
- Professional indemnity insurance – If you provide knowledge and advice which causes an employee to lose money, your claims will be covered with this insurance.
- Building and contents insurance – If you hold stock and equipment in your home your building and content insurance will keep you protected from damage or loss. (your landlord may already have this insurance check the policies which are covered.
- Cyber insurance- This covers you for your losses and damages relating your IT systems and networks. Learn more about Cyber insurance and how your business needs it.
Within your insurance comes a license, your business may be required to operate on a particular license. Use the government license finder tool to work out if your business needs a license and if so which one.
Each business must pay a tax on what they earn, you should be able to calculate how much tax your business should be paying. To learn more about how much you should be paying review your tax with small business tax review – Get in touch with EMS to learn more, visit tax.
Furthermore, to get more information visit the government website for detailed information on business tax.
Business rates are paid if you use part of a building for non-domestic purposes. Unsure of what your business rates are, get help with your business rates today. In addition, you can look into business rates working from home.
Finally, you should be well informed of how you can run a business from a rented home or property, successfully with the correct and adequate procedures in place.
Are you looking to start a business?
If you have an idea for a business or are interested in learning more about becoming self-employed fill in the form below: