Things to consider before starting a home-based business
If you're starting a home business, developing a thorough business plan is the best place to begin. To develop your business plan, you need to consider these points about operating from home:
Is your home the best location for your business?
Can you conduct the type of business you want under local council regulations?
What are your legal obligations?
Will your home-based business allow you to balance your work and family life?
What are the town planning requirements of your local government authority?
Don't be afraid to ask yourself hard questions about your business. It's much easier to plan for the future than to react to the unexpected.
Meeting government requirement and regulations
Like all businesses, home-based businesses need to register for business and company names, taxation, and other business licences and permits. Using your home as a place of business may also mean complying with particular state, territory and local government regulations.
The impact of your business activities on the surrounding residential area, particularly pollution, energy use and parking, can all require special permission. Depending on your type of business, you may need special permits relating to zoning, signage, noise levels or health issues.
Local Council Regulations
Working from home can make sense from both a cost and lifestyle perspective, however it also calls for thorough scrutiny of the council regulations that may apply to home businesses operating in your area. Find our guide below to understand what is needed before you hang the open sign.
Things to consider before starting your small business from home:
Contact your local council
All councils establish guidelines for the use of private land within their local government area (LGA). As your home–based business will typically be operating in an area zoned for residential use, one of your first steps should be to contact your council’s planning department to see whether your business will comply with local zoning regulations and whether or not you will need any special permits.
While requirements vary between councils, generally home-based businesses don’t need special operating permits if the building you work from is also your primary place of residence. This can change however if you employ workers who do not live in your home. A permit may be needed if you hire more than one worker who doesn’t share your home.
Does size make a difference?
The size of your floor area can also affect the nature of any permits you require. Some councils stipulate that the business must not occupy more than 50 square metres, or one third of the total floor area of your home. There can also be restrictions imposed on running a business out of an apartment.
Parking & signage
If your home is likely to be a meeting place for customers, your council may request that additional off-street parking be provided at your home, or that a separate entrance way be provided for business clients. Where this is the case, or even if you want to erect any signage, you may have to submit a Development Application (DA), asking for council approval before the necessary alterations are made to your home. Additional information, such as a Statement of Environmental Effects, site plan, existing and/or proposed floor layout plans may also be required.
Where a Development Application (DA) is called for, your Council will notify neighbours of your plans to run a business from home. Even when this is not the case, it makes sense to discuss your plans with neighbours to hopefully prevent any friction further down the track.
It’s worth stressing that individual councils set their own regulations, so be sure to check that you comply before hanging out the ‘Open for business’ sign. Relying only on the advice or experience of friends or business contacts could land you in hot water as council regulations are subject to change.