New rules to help home businesses

Friday 15 August 2014

Entrepreneurs will be given greater freedom to start up a business from their home as part of new measures announced by the Government.

These include legislation to make it easier to run a company from a rented property and new guidance on business rates clarifying that, in most circumstances, home-based firms will be exempt.

Planning guidance is also being updated to make it clear that planning permission should not normally be required to run a business from home. Announcing the package, business minister Matthew Hancock said there had never been a better time to start a company.

He went on: "It's this spirit of personal endeavour and self-determination that is driving our economic recovery. But home businesses don't just fire up the economic engines and create jobs, they turn dormitory towns into living communities, they keep our streets safer, and by driving down car emissions, cleaner too. We'll give people the confidence they need to run a business from a rented home, making sure that the majority of home businesses are exempt from business rates and our aspiring entrepreneurs have the information they need to start up and grow."

The law is to be changed so that landlords can be assured that agreeing to a business start-up within their property will not undermine their residential tenancy agreement. A new model tenancy agreement will also be made available.

Mr Hancock was speaking at the first ever Home Business Summit, organised by the small business network Enterprise Nation. Its founder Emma Jones said one in ten domestic properties are now home to at least one business.

She added: "These are not people starting businesses out of necessity through lack of jobs, they are part of a growing movement that is responding to the new opportunities technology brings and actively taking control of their own destiny by starting out from home. They are hard-working people who now have the capability to trade globally from their own kitchen table. They are growing through outsourcing work to other home-based individuals and as they do so, they are bringing important employment opportunities to rural as well as urban areas of Britain."

Liz Peace, chief executive of the British Property Federation, said it firmly supported the Government's move to remove "unnecessary barriers" to setting up at home.

"At least some of the kitchen table businesses of today will expand and become the commercial property space-seekers of tomorrow," she continued. We therefore have an interest in ensuring that the law and our sector is adapting to modern business practice and supporting UK entrepreneurs at every stage of their business development."

Around 70% of new businesses start off in the home and they contribute £300 billion to the economy, according to the Government.