Running A Business From Your Home has become an increasingly popular choice, with hundreds of thousands of new businesses launching each year in the UK.
Between March 2021 and 2022 alone, 753,168 new businesses were recorded, and many of them operate partly or exclusively from home.
Whether you're starting a side hustle, freelancing, or building a full-scale company, a home-based business offers flexibility, lower overhead costs, and the opportunity to work on your own terms.
Let’s explore the essential steps to successfully run and grow your business from home.
There were 753,168 new businesses recorded in the United Kingdom between March 2021 and 2022.
And plenty of those start-ups are companies that work either partly or exclusively from home.
There are plenty of benefits - not least the fact that you can save a lot of money on not renting premises.
But, as with any business venture, there are some pitfalls too - such as the cost of energy bills running a company from your own home.
Here is what you need to know about running a business from home.
5 Pros And Cons of Running a Business from Home
So you’re thinking about running a biz from home? Oh, honey, buckle up—because it’s a wild mix of freedom, chaos, and snack breaks! Here’s the real deal from a work-at-home mom’s perspective.
🌟 The Pros:
- Pajamas: Work Attire
No judgment if you roll out of bed, throw on a semi-clean sweatshirt, and call it “business casual.” Bonus: No annoying commute! - Flexibility for Mom Life
School pickup, dance recitals, surprise fevers? No need to beg a boss for time off—you are the boss. - No Office Drama
No awkward breakroom small talk or passive-aggressive emails. Just you, your laptop, and (hopefully) a coffee that hasn’t gone cold (again). - Tax Deductions, Baby!
Your home office, internet, and even that fancy ergonomic chair? Yep, they could be tax write-offs. (Just don’t ask me for accounting advice—I barely keep track of lunch money.) - More Time with the Kiddos
You’re there for the first steps, the spontaneous hugs, and, okay… also the toddler tantrums. But still, memories!
😵 The Cons:
- Work + Mom Life = Chaos
Picture this: You’re on a Zoom call, and suddenly someone’s screaming about a missing toy. Professionalism? We try. - Zero Separation from Work
Your dining table? Now an office. Your bedroom? Probably has a laptop in it. Good luck “leaving work at work” when work is literally everywhere. - All the Distractions
Laundry stares at you. Dishes call your name. And suddenly, you’re deep-cleaning the fridge instead of finishing that project. Oops. - Lonely AF
No office buddies to vent to, no after-work happy hours. Just you and your houseplants (who are, honestly, tired of your oversharing). - Everyone Thinks You’re “Just at Home”
“Oh, you work from home? Must be so nice to relax all day!” Um, excuse me while I laugh-cry between meetings and snack duty.
Running a business from home is a beautiful, messy, caffeine-fueled dream. Some days it’s a hot mess, but honestly? I wouldn’t trade it for the world. 💕 Who else is in the work-from-home trenches with me? Drop your funniest WFH mom moment in the comments!
Where To Start
It might sound obvious to say it, but the very first thing you need to ask yourself is "is it possible to run a business from home?"
For instance if you provide a service in person, such as a beautician, a childminder, chiropodist etc., then ponder if you have enough space, whether your business will affect your living area, and if you have the required equipment.
You will also need to think about the safety of others sharing your living space, if the business has room to grow and the potential consequences of having to take on new staff.
Alternatively, if you are a business that will deliver online services do you have enough room to keep stock in your home? And what about the broadband? If you need to transfer large files for example, then poor internet can have a major impact on how you run your company from home.
IT Infruscture At Home: Things to consider
Before beginning a home business venture, there are a lot of considerations to factor in.
First and foremost is the work environment. You will want something that is functional, fully equipped, comfortable, and free from day-to-day distractions.
Where possible have an office or personal space dedicated to work so that you can separate work and home life.
Secondly, make sure all your necessary IT equipment can cope with the demands of running a full-time business.
Things like laptops, printers and broadband will need to be able to cope with full-time work.
You will need to have a server that can be backed up and have a storage system or cloud that can also back up important files.
And if you have to deliver a lot of post are you close to a delivery service. It's also ideal to employ the help of a professional who has completed an online full stack dev program to create your business's website.
You will also need to think about practical needs. For example, if your business requires you to hold a lot of stock do you have enough space/storage in your home to hold it?
If you have to transport a lot of goods do you have a vehicle suitable to do so?
And, naturally, you should give consideration to your neighbours. If there will be a lot of disruption, try and keep mess and parking issues to a minimum.
The last thing you want is a civil war with people you have to live next door to every day.
What About Taxing?
The part that gives some home-business workers dread is the numbers involved and the tax you have to pay, which is why it is advisable to consult with a reliable tax advisor before starting up your home company.
For example, if part of your home is used exclusively for business - such as a shop and no other purpose - then you have to pay business rates on that part of the property.
The experts from https://sts1stop.com/ suggest consulting with a tax professional to ensure you’re properly classifying your property for tax purposes.
Understanding these distinctions can help you avoid unexpected expenses and maximize any potential deductions available for home-based businesses.
It may also be the case that you have to pay Capital Gains Tax on that part of the home were you to ever sell the property.
In terms of self-assessment tax returns, you can do simplified expenses if you work 25 hours or more from home, so paying a flat rate for some business expenses as opposed to having work out exactly how much of your home bills were spent on business.
By doing it this way, you are able to claim back on some household costs such as heating and internet bills and council tax.
Tax Benefits of Running Your Business from Home in the UK
Running a business from home in the UK comes with several tax advantages that can help reduce your overall expenses.
One of the biggest benefits is the ability to claim a portion of your household expenses as business costs.
This includes utility bills, rent or mortgage interest, council tax, and even broadband costs.
If you use a dedicated space for work, you can calculate the percentage of your home used for business and claim that proportion of your bills as a tax deduction.
Alternatively, HMRC provides a simplified flat-rate expense option based on the number of hours you work from home, making the process easier for small business owners.
Another key tax advantage is the ability to deduct business-related expenses, such as office supplies, business phone calls, and even a portion of repairs or maintenance costs if they relate to your workspace.
If you purchase equipment like a laptop, printer, or office furniture, you may be able to claim capital allowances, reducing your taxable income.
Additionally, if you hold virtual meetings or operate an online business, you may be eligible for VAT deductions on business-related purchases.
Taking full advantage of these tax benefits can significantly lower your operating costs and improve your business’s profitability.
However, it’s always a good idea to consult a tax professional or accountant to ensure you’re claiming expenses correctly and maximizing your savings within HMRC guidelines.
Leave a Reply