Working from home and how to start a home business
Running a home-based business keeps overheads low and so for
many is a sensible way to start-up. For others, running a home
business offers the freedom they've enjoyed in work from home jobs
on a full-time basis.
But working at home as a new business isn't always
straightforward. It can affect your mortgage, your home insurance,
your tax situation and could even turn your neighbours against you.
This guide makes sure you've considered all the ramifications of
working from home before you make your final decision and to start
a home-based business.
- Working from home checklist
- Health and safety
- Hidden costs
- Hidden cost benefits
Work from home checklist
Read your mortgage or tenancy agreements carefully - your
mortgage lender or landlord may ban you from using your home to run
a business. You may require extra insurance, especially if you're
inviting clients to your home or you have staff working from your
house - or separate insurance cover for computer or office
Talk to your neighbours, explain your plans and make sure they
have no objections - things such as car-parking can be an
issue. Always run any structural changes to your home by the
planning department of your local authority.
- Check regulations with your landlord , mortgage lender and
- Discuss plans with your neighbours
- Speak to your local planning department if considering building
Health and safety
You need to talk to the Health and Safety office in
your local authority to clarify any health and safety issues you
need to tackle when running your business from home. The first step
is to carry out a risk assessment which will help you identify any
potential hazards to yourself, your staff, your clients and to
other members of your household. Download a free risk
assessment guide from the Health and Safety Executive at http://www.hse.gov.uk/pubns/indg163.pdf.
- Talk to your local authority's Health and Safety office
- Carry out a risk assessment
While you're saving money on rent you should take into account
other additional costs. For example, you may be charged business
rates on your home rather than conventional council tax. Or if you
have a specific room for work only, you may also be liable for
Capital Gains Tax if you sell your home.
Call the Valuation Office Agency (VOA) on 0845 602 1507 - they can
answer your queries on business rates.
- You may be charged business rates and capital gains tax if you
work from home
Hidden cost benefits
You may able to claim tax relief on your utility bills for the
areas of the house you use exclusively for business. You may be
able to claim back either VAT or capital allowances on purchases
you make for your business (ICT equipment, office furniture
etc). Read more on this in our guides on VAT and capital
- You may qualify for tax reliefs
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