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what do I need to know if running a business from home?

Discussion in 'Legal Issues' started by Barny, 28th Feb, 2016.

  1. Barny

    Barny Well-Known Member

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    Morning team.

    My wife is soon to be a yoga instructor and we are looking into different options. We're thinking perhaps to buy a home she could run her classes either casual/part time or full if she chooses. Most likely need to build a studio on the property, looking at bigger 1-3acre homes at the moment.

    We already have a ppor elsewhere which will stay ppor, the new purchase we will live in.

    I'm sure council is the first step to ask, but would be great to hear and to learn if others that have or do this.

    I don't know if normal house insurance will cover liability insurance if someone was to hurt themselves?
    parking issues?
    Can you run this type of business from residential living?
    If we end up selling the house eventually, will this change the tax payable, or just run under the simple investment tax rules as its not our ppor?
    I was told many just run classes from their home and don't mention it to anyone, I don't want to be liable if it's not legal.

    Any tips or help is greatly appreciated as always.
     
  2. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    You will need separate insurance cover for your business activities. Parking should not be much of an issue on acreage. If you make this your PPOR you will lose a portion of your GCT-free status on this property.
     
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  3. JacM

    JacM VIC Buyer's Agent Business Member

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    Your insurance company needs to be told that you intend on using the property for this business purpose and insurance will have to be tweaked accordingly at the relevant time.

    If you have a mortgage, your lender may not be too happy about a site on a residential loan being used for commercial purposes. Check your loan contract to ensure you wouldn't be breaching the agreement.

    I don't see how you can run your classes from home and not tell anyone. The attendees will know, and will likely tell their friends also. If you advertise you'll have to indicate where the classes are held.

    Parking could well be an issue with council.

    Having lycra-clad folks regularly coming to your home could attract some attention... if you proceed with this be very careful of the timeslots of your classes. After dark could present personal safety issues for attendees when returning to their cars.
     
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  4. JacM

    JacM VIC Buyer's Agent Business Member

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    A few other thoughts ... as it's a gym-type-activity you might require someone to have a first aid certificate. You might need a first aid kit/facility on site. This may include the requirement for a defibrillator.
     
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  5. Barny

    Barny Well-Known Member

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    Thanks heaps for the feedback. great tip. Lucky we are both qualified. Great advice, wonder if a defibrillator is needed. I'll get on that.
     
  6. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Many councils have relaxed policies relating to home based classes such as yoga, dance etc
     
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