Home Businesses overlooked by Support Agencies

Invisible Business: the characteristics of home businesses

Home–based businesses are often “invisible” to regulators and support agencies despite accounting for a third of small firms, a study published by the University of Strathclyde Business School has revealed.

Invisible Business: the characteristics of home businessesThe report, Invisible Business: the characteristics of home–based businesses in the UK (672k PDF), claims that their low profile results in home–business owners not being informed of how enterprise policies, business regulations and tax laws will affect them.

The report argues that businesses run from home are considered economically insignificant, even though the sector is expanding and home businesses are growing in scale. The research found that the majority employ staff and generate more than £50,000 per year. One in ten employs at least ten people and has a turnover of more than £250,000. Report co–author Professor Colin Mason said:

“As more entrepreneurs choose to base their companies at home, we need to see a change in enterprise policy at local, regional and national levels to encourage home–based businesses,”

“Many home–based business owners feel unsure of their legality and fear the complex tax system and what regulation might mean for them. The sector needs more clarity and encouragement if it is to reach its full growth potential,” he added.

Emma Jones, the founder of home business website Enterprise Nation, echoed Mason’s view.

“The biggest problem home–based businesses face is a lack of clarity,” she said. “When somebody starts a business from home they don’t know whether to tell their local authority or their mortgage provider, or whether they need planning permission or insurance.

“At the moment home–based businesses are operating in an environment of uncertainty – sometimes they don’t call the council because they think they will get into trouble,” she continued. “What needs to be done might be very simple but it can take hours to find it on a government website. Home–based businesses hide because the government hides the information that they need. We want all local authorities to display clear information for these businesses.”

Home businesses would do well to take a look at is4profit’s extensive selection of business advice articles.

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