Can a tenant run a business from a rental property?
The simple answer to this question is yes, you can run a business from a rental. However, that answer can be very misleading if you are unaware of the procedures and everything required of you as a tenant to run your business from a rental property. The fact of the matter is that since you do not own the property, there may need to be some extra steps that you will need to take to ensure that your business is legal to operate from your home.
These usually do not cost any money, so you will only need time to check that everything is in order. Not checking that you can run your business from your rental property could lead to severe repercussions and even eviction in some cases. We recommend that you take the time to ensure that everything that you are doing is legal and approved.
What are the requirements for running a business from your rental home?
You will need to ensure a few requirements are met if you want to run your business from a rental property. First, you will need to determine what part of your rental home will be used for your business operations. If your business will take over your entire flat or home and you will no longer live there, operating from your rental home would be illegal. You will need to ensure that the property functions primarily as your home and living space and is secondarily used as your business.
The second thing that you will need to check is your lease. Suppose your lease explicitly mentions that you are forbidden from using the premises for any business operations. In that case, that means that you cannot technically use your rental home for commercial use.
You could try talking with your landlord and seeing if this is something they would be willing to revise, but if not, you have no choice but to operate your business from a different location. Even if there is nothing in your lease explicitly saying that you cannot operate a business within your rental home, it is still a good idea to contact your landlord ahead of time to get proper approval for your operations. To learn more about landlord approval, you can click here.
The third important thing you will need to consider is the type of business you are running. If your business is likely to cause noise and disturb the neighbours, you might find that running it from your home may not be the best option. When registering your business to your local council, they will be interested to know what type of business you are running to determine whether it is likely to cause a disturbance.
They will also check if you can work a commercial business from your rental property, as some particular areas and properties do not allow for commercial use of the properties in the area. Your local council will either permit you or not based on many things. Still, most of them will relate to whether your business is likely going to harm or disturb the area or not, so when planning your business, this is something to consider.
To read more about running a business from your home, you can look at the citizens’ advice page and relevant articles by clicking here. To learn more about registering your business from your rental property, we recommend reading the government website by clicking here.
Is there anything else that you will need to consider before you decide to run a business from a rental property?
If you plan to run your business from your rental property, you must contact an accountant. They will tell you whether you are eligible for any tax deductions or business rates because you are using your home as a business. Depending on your area and your local council, there may be a few different deductions that you can make depending on whether you are employing other people, how your business operates. It also depends on the percentage of the property you use for your business. So, if you are interested in saving some money for yourself and your new business, definitely check with your tax accountant.
You should also consider what type of insurance you might need for your business. Your renter’s insurance is most likely not going to cover any of your business operations. Depending on whether you have and operate machinery, or if your business requires clients to visit your property, you may be required to sign on with a different insurance policy. So that is always something to check out.
The existing legal framework for operating a business from your rental home does not differ much from operating one from your home. If you want to learn more about that, we recommend reading the article found here.
Other useful links from our knowledge centre:
How to Identify A Great Business Idea
Register Your Company Name
9 Ways to Grow a Small Business
Remember to Compare Your Business Costs is here to help your business every step of the way from business advice, or saving you time and money on your business purchases such as: