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Hi, my friend and I are both business students graduating this year. He said he is thinking of starting a business from home after graduating and he needs to find out how much business rates would be for his property. I said that is a stupid question because it is your home and you already pay council tax – business rates are a tax on commercial property not a tax on businesses themselves. So we took our disagreement to a local authority drop-in centre to seek advice from a specialist and the only person there was a secretary who said we could make an appointment, but my friend said nevermind, do you know anything about rates/will i have to pay if i am running a business from home? She said along the lines of “ohhh yes of course you have to pay rates if you are running a business even if it is from home, it is still a business.” So he has declared victory, but i am not convinced!

I cannot find anything about it online or on here, yet i know loads of people who run businesses from home and don’t pay business rates. What about all the people on ebay selling as a business, they don’t pay x thousand pounds for the priviledge do they?

I would be really appreciative of a knowledgable response!
i think he is thinking more along the lines of selling paperclips on ebay than turning his house into a supermarket 🙂

2 Thoughts on Business rates for a home business in UK?
  1. Reply
    August 10, 2011 at 4:06 am

    The answer is that the LA has the power to levy rates on a house used for business, but whether they actually would depends on the extent to which the property is being so used. If you are just using your spare bedroom to run a home business (like thousands of other people), then they are unlikely to do so, even suppose they found out about it. If, however, you are doing full scale trading from home, with people turning up at the door, then they probably would (and the neighbours may not be too happy either.)

  2. Reply
    August 10, 2011 at 4:45 am

    my husband runs a business from home (UK) and does NOT pay business rates as we already pay council tax on our home

    My son,runs a business from his home address, and again,pays no business rates,but does pay council tax

    Both are Sole traders, who work on their own, and don’t employ staff.

    Both are legit, registered businesses, with sole trader business banking

    Hope that helps

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