Working from home

[Keith Cocker]

My wife and I ran a consultancy business with a home base for 27 years. We had a dedicated office in the house but the nature of the business meant there was no stock or client contact at home. We had no problem with rates etc and as someone mentioned you can offset a portion of your costs against tax. We even had the VAT inspector spending the day with us when we had an inspection ( he didn’t find anything wrong and drank a lot of our tea!

 

[Terry - Somerset]

Taxation - as I understand it, if you charge a proportion of your property costs (rates, utilities etc) against the taxable income you generate working from home, you may be liable to capital gains tax on a part of the profit when you eventually sell it.

There are some ways round this - but it would be worth checking as it could be a bit of a shock if not planned for.

 

[Doug71]

It hit home a few weeks ago that I was in the wrong business, I'm a joiner and therefore need a workshop, and if I'm not in there I'm working in a customers house.

My friend has an IT business, he's just been to Spain for 4 weeks with his family yet he still managed a few hours work most days.

It must be great that wherever you are in the world or whatever time of day it is you can just flip open the laptop and do some work. No overheads and not tied to a location, not jealous at all

 

[Dibs-h]

It hit home a few weeks ago that I was in the wrong business, I'm a joiner and therefore need a workshop, and if I'm not in there I'm working in a customers house.

My friend has an IT business, he's just been to Spain for 4 weeks with his family yet he still managed a few hours work most days.

It must be great that wherever you are in the world or whatever time of day it is you can just flip open the laptop and do some work. No overheads and not tied to a location, not jealous at all

Sounds like my mate - this year so far: 6 weeks in Dubai, 3 weeks in Istanbul, a few weeks in Tenerife and about 3 months all over the UK, all "working from home".

And most of that time - pet sitting at the same time, so zero accommodation costs.

 

[ian33a]

Working for yourself ('running a business' ) vs working for Fred Bloggs, but at home?
Is there an (insurance view) difference?

Generally yes: if you work for somebody else the equipment and materials are owned by somebody else it they should be insuring it or cover the cost in the event of a loss. If you run your own business from home but have no materials or equipment then there really is nothing to ensure. Trouble is, the moment your company holds some inventory (equipment or stock) the insurance companies see this as a higher risk and make you pay.

Sometimes, if you waive any right to make a claim for anything that the business holds if the event to an incident, you can avoid an insurance cost increase. In this situation your need to weigh up the consequences of doing so.

When we ran our business from home we waived these rights and the insurance mark up was smaller - but we still had to declare that we were running the business from home.

 

[ajs]

Plus one for the comments on insurance. Insurance companies will use any excuse/reason not to pay out - an electrician doing some work for told me that one of his customers was refused a payout for serious damage done by a major water leak in the roof ....................................... because his electrical test certificate was out of date.

I've mentioned here before I used to be a home insurance claims handler... If that was an outright refusal it would not survive review by the ombudsman. There shouldn't be any issue with redecorating/drying/recarpeting etc costs. I can see issue with electrical work since the insurer will have to ensure it is compliant and guarantee it - that means checking and certifying anything that has lapsed which would count as betterment, generally not covered. But even then I'd expect some kind of cash offer towards costs being made.

A comparable example from my own experience was a few missing roof tiles as storm damage. Have the work costed and the report came back that it's a 1910 property, still on original roof, entire roof suffering from nail fatigue and our contractor would not be willing to guarantee the work or even that other tiles would no be dislodged doing it.

No guarantee meant we flat out refused to do the repair, but still offered the notional amount quoted as a cash settle, despite the "good standard of repair and maintenance" clause in the policy because we couldn't rely on that. No, we're not going to do your entire roof for you but we won't reject the claim outright either.

 

[woodieallen]

My wife had a beauty business and was told if the room was duel purpose ( not solely for business ) you don't need to business rates. She put an ironing board and clothes dryer in the room when the council inspector visited.

Digressing slightly, I had a roofer round the other day. He does a lot of work for the Council. I asked him if he got inspected by HS&I much. "Every few weeks" was his reply. "But it's not a problem because being mainly Council work, they have no idea where we are working and so ring us to ask for the address".