With an increasing number of people working from home, especially since the start of the Coronavirus pandemic, it is important to ensure that any relevant permissions have been obtained.
This blog will focus specifically on whether people are allowed to run their own business from home.
What permissions are needed for a home business?
The various permissions which may need to be sought depend on the type of business being operated from the premises.
The most straightforward businesses to run from home are those which only require a phone, computer and internet connection; essentially an online business.
In this case, the relevant permissions are:
Often there will be a clause in mortgage agreements which precludes the use of one’s home as a place of business. In this case, it is important to clarify with the mortgage company exactly what is and is not permitted. For this reason it is advantageous to have a relevant document which makes things clear.
Additionally, it will be necessary to check the terms of any leasehold agreement.
Tenancy agreements often stipulate that tenants are not allowed to run a business from the premises.
It is a good idea to obtain express permission from the landlord (or letting management agent, social housing provider, council etc) to ensure that working from home will not constitute a breach of the terms of the tenancy agreement.
Employees and client visits
If there are any employees who need to come into your home on a regular basis, or frequent visits from clients, it may be more difficult to obtain permission from the mortgage company or landlord. For example, if it is likely to cause any nuisance to neighbours (e.g. with a constant stream of people entering and leaving the premises).
Furthermore, other permits may be required, such as:
Depending on how the property is going to be used, and if any specific licences are required, the local council may need to consider whether to grant the relevant permit or licence.
It might also be a good idea to obtain a Certificate for Lawful Use, under section 191 of the Town and Country Planning Act 1990 (see ‘use classes’ below).
Home contents insurance may not cover business equipment, so it may be necessary to get separate business insurance.
Also, if any clients/customers visit the property, it is advisable to obtain public liability insurance (e.g. in case someone injures themselves).
Furthermore, if there are any employees working from the property, an employer’s liability insurance certificate will need to be obtained and displayed. Additionally it will be necessary to carry out any required health and safety checks.
Converting part of a home into a business property
If any substantial changes need to be made to the property, or the intention is to make part of a residential property into a business property, it will be necessary to gain the relevant planning permission:
Where the original purpose of a building is going to be changed (e.g. a garage is being converted into a hair salon), it will normally be necessary to obtain planning permission to change the ‘use class’ of the property (this officially designates what it can be used for).
If any major alterations need to be made to a property, such as building an extension to house an office, consent from the local planning office will be required.
Furthermore, it will be important to check the deeds of the property to ensure that there are no restrictive covenants preventing certain types of trade.
Finally, to change part of a property into a retail or hospitality premises, it will normally be necessary to gain all of the above permissions in addition to having to pay business rates.