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Can I run my business from a property I rent?

9th April 2017

If you want to start a your home business then you are not alone. According to the official government website, fifty-nine percent of businesses are started and ran home the comfort of people's homes. However, if you are thinking of starting your business from your rented home, there are some things you have to take into consideration. In this article we will be discussing some of the laws surrounding home run businesses and how it affects you.

It is a requirement that if you want to start your business from your rent residential property it is necessary  that you get written permission from your landlord. This can be an issue if you have a bad relationship with your landlord. However, in 2015 the Small Business, Enterprise and Employment Act was passed and within it states that landlords can't withhold permission without 'reasonable' justification.

The general understanding for 'reasonable' justification is that if your business will disrupt those living around you or affect the property you are living in, then  your landlord has the right to deny you from running your business from home.
If you know that your landlord is still paying off the mortgage for the property you are renting, then there is another factor you need to take into consideration. If too much floor-space is being taken up by your business, then the property will be considered as 'commercial' rather than residential. This will be a breach of your landlord's mortgage agreement, resulting as reasonable justification for your landlord to withhold permission.

Depending on what type of business you are running from home, the cost of your energy bills may increase. If you are renting a property where the bill are all inclusive, your landlord may have to increase the rent to make up the difference. This may directly impact your ability to effectively run your business from home as you will have higher monthly costs.

Another monthly expense which you may find yourself paying more for once you setup your business is council tax. Depending on the type of business you are running from your home- you may be liable to pay business rates on top of your usual council tax bill.  Although this is uncommon for home businesses, there are some situations where you will be liable. Running a shop downstairs from your property, selling goods or services to people who visit your property, or employing people at your home are the most obvious situations where you will be liable for the additional council tax.

Although we have covered a lot in this article, there are many for factors you may need to take into consideration if you want to start running your business from home. At PNGFormations we help people setup and run their business as easily as possible. If you want to find out if you are able to run your business from home or want to find out how else we can help you, please contact one of our experts here today.

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