Home Business Legal Considerations

When you're starting up a new business, the last thing on your mind is probably business legal advice.

However, legal advice for business entrepreneurs is vitally important (along with all those other business planning considerations!) so take time out with a nice hot coffee and read our business legal advice for home business owners.

Running a business from home can offer flexibility, low costs and a great lifestyle, but it’s important not to overlook the legal implications of using your home as a business premises.

Let’s look at some of the main business legal advice for home business owners that you should consider.

When you're starting up a new business, the last thing on your mind is probably business legal advice.

Permission To Use Your Home As A Business

Using your home as a business? Why not we say, but wait there’s a whole range of organisations that may throw a spanner if the works if they object to you running a home business. This includes your mortgage lender, the freeholder of the property, a landlord, the local authority and the Residents' Association.

If you have a mortgage, you’ll probably need to renegotiate the terms of this as home business customers are normally considered to be higher risk.

Insurance

Using your home as a business could invalidate your home and contents insurance. Aside from the obvious risks of not being insured, remember that if you have a mortgage, you are probably obliged to maintain home insurance. 

You’ll also need to consider Employer’s Liability Insurance (if you have any staff, even on a casual basis) and Public Liability Insurance. Of course, there is nothing specific about these kinds of insurance to home business but they can be overlooked by business people operating outside the typical workplace environment.

Many insurance providers offer comprehensive home business insurance packages including all these types of cover. 

Taxes

Next consideration is looking at tax advice for your home business because running a business from home can offer big tax advantages if you are self-employed. A portion of the expenses of running your home (council tax, utilities, telecoms, rent, mortgage payments and so on) are tax-deductible.

There are downsides though.

You might become liable for business rates rather than council tax in respect of the parts of your home you use for work. The Valuation Office Agency and local council will assess this, taking into account factors including the frequency and duration that you use the rooms for work and if you have made any modifications for business purposes.

You might also lose part of your entitlement to capital gains tax relief on the sale of your home if part of the property is used exclusively for your business.

Health And Safety

Most of us home business entrepreneurs wouldn't even think they need to think about health and safety advice for running a home business.

Making your home into a workplace brings a lot of compliance requirements and red tape. Notably, you’ll need to abide by health and safety in the workplace regulations. You’ll have to carry out a risk assessment of your home to identify any hazards (eg. fire risks, handling loads, slips, trips and falls) and make clients, staff, household members and visitors aware of the risks. 

The legal side of running a business can be quite complex. The cost of assistance from a solicitor and qualified financial adviser is almost always worth it in the long run. By considering the legal issues thoroughly you should be able to take full advantage of the financial and personal benefits of working from home. 

Business legal advice covers a whole raft of legal jargon, from basic legal advice for business entrepreneurs, home business owners to council tax advice for home businesses and home business tax deductable expenses.

To learn more about the business legal advice that start-up businesses should consider, visit Contact Law.

 

Our Readers Also Liked