Question re tenants running a business from a rented home

Donna,

That sound like a hobby and provided it looks like one on any inspection the landlord/agent does, personally as a landlord I would rather you did NOT ask

You must not have a room you just use for it, so for example if you put the sewing machine in a spare bedroom, then keep a bed in there and have some friends to stray a few nights every few months.

You are selling a few items on eBay to cover the cost of your hobby, no different than selling some jam at the local WI. If you make a profit, then so be it., but the aim is not to make it profit, it is to learn skills and get your confidence back, so you can get into work.

You do have to tell HMRC and all the benefit people if you do make a profit, or when you start often to sell items.

Hi,

Thank you for getting back too me and because it would be permitted work, you have to fill a form in and it states that hey would tell the HMRC.

This is were it worries me that the landlord would find out, I have not sold anything on it yet. It may not work out and what I wanted to do is try it, I would like to eventually have it where I am making a profit from it.

I keep reading up about self employed and if you are you have to register as a Business, that worries me because I am using this address.

Thank you for giving me advice about not having a room just for it, I have the machine sitting on a chest of drawers. Nothing at the moment to say I am running this from here and all sewing things are kept out of sight, don't have that much any just a small bag of fabric.

Reply to the comment left by "donna douglas" at "05/06/2014 - 11:31":

Donna,

The problem is if you ask your landlord, then the landlord is likely to HAVE to say no, due to his insurance and mortgage etc. But the landlord will find it expensive to evict you if they do find out.

If one of my tenants did what you are planning to do I would rather not know, and would only “discover” it if it was clear on an inspection that more than a hobby was going on. HMRC will not inform your landlord.

That is great and I spoke to the Job Center who say can class this is permitted work. They said that you will be self employed but they said it was not a business, that was what worried me having to register here as a business and landlord finding out.

That is what worried me that I would ask that they would say no and I would of gone with that.

I wanted to more nearer my parents so worried about how I would deal with that renting a flat, say it does take off. They will want bank statements and worried that they would contact my landlord asking about being self employed.

My boyfriend was taken to hospital with a massive blood clot and not being flip int about it, but it made me stop putting obstacles in the way and do this.

The money I earn will help me move to be near my parents and I can use their spare room to work in if that is ok.

Thank you for all your help.

Reply to the comment left by "donna douglas" at "04/06/2014 - 23:24":

If you are making things to sell (rather than selling unwanted possessions), then you DO have to register as self employed with HMRC (I have recently gone through this on behalf of my wife). I think you have to register within 2 months of starting a business (that is, within 2 months of making your first sale).

If you do not register and HMRC find out, then there are financial penalties.

It is not difficult to register via the HMRC web site and you DO NOT have to register a business at your address. HMRC are not allowed (Data Protection Act) to tell anyone that you have registered as self employed. They also do not need to know what you do: for all they know you could be a self-employed gardener using tools supplied by your customers and doing nothing from home.

You may also want to opt out of paying Self Employed National Insurance contributions (an option for those who have low earnings from self employment). BUT you need to consider the implications of this and should take professional advice. (Note that income from employment and income from self-employment are treated separately for National Insurance contributions).

Regarding the Tenancy implications, I would agree with others that if you ask the landlord, then he will have to say 'no' to protect himself; many leasehold agreements have a term banning business in the property. However, you are entitled to 'quiet enjoyment', so as long as you are just selling the products of a harmless hobby or therapy there should be no problem provided that you do not create a fire hazard or annoy the neighbours (e.g. by use of a noisy sewing machine in the middle of the night).

It is my view (rightly or wrongly) as a landlord that such a clause is
1. to prevent activities that would annoy the neighbours.
2. to prevent the property being used only for business and not for living
3. to allow the landlord to charge for damages caused by business activity (eg additional wear and tear)

Thank you so much for your advice and DWP said that they would inform HMRC.

When you say that you DO NOT have to register a business at your address, you can tick a box for that?.

That is great advice about being self employed and I am never sure if doing this you are just self employed or is it classed as a business. I have not tried to sell anything yet because I wanted to find out with DWP and landlord if I could do this.

What I want to do is start this off and I would like it to turn into a proper business, but that would not be in the next 3 months'.

I am careful about using the sewing machine, it is a domestic one so does not make that much noise. But I also do not use it late at night as I do not want annoy anyone, plus when I do use it is only for short amount of times.

I understand why the clause is there and what is so annoying is that you want to be honest but you are right they will probably say no.

I am applying for jobs and seem to get close but it is taking longer than I thought and sewing is more what I want to get into. If I do this and keep doing a tailoring course and sewing classes.

I could approach an alterations shops for work, doing this from home is the only think I can think of that will improve my situation and I really need to improve things financially. Have a career path and get out of the bleak situation of being unemployed.

I hope that your wife's business goes from strength to strength.

Hello all

I'm currently considering a tenant who is a mobile hairdresser

They are potentially taking on a house which is bigger than they need and my obvious suspicion is that they will run a business from home

The potential tenant says they will not, and the AST will say they are not allowed to run a business

I've discussed with the letting agent that I would seek the agents assurance that a business is not being run from the property as part of their reports from routine property inspections

However is a business does end up being run from the property and something happens (say a fire) then ...

The insurance people would very likely not want to pay as the use would not be covered

The mortgage lender might become involved

I might have up having to try and get significant damages from the tenant (possibly in court) and probably with little chance of recovering a significant sum

I might even have to take the letting agent to court as they would have assured me no business was being carried out

I may well be worrying unduly (but I am a landlord!) but does anyone have any experience / knowledge of how such a situation may play out

Many thanks

Reply to the comment left by "Robert Hayes" at "16/06/2014 - 12:44":

I think it is more likely that your tenants intention is to take in lodgers to subsidise their own costs of living.
.

I would be grateful to know with ref to a tenant childminding . Do I need to say no to this .