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Home Businesses Get Unexpected Boost as Government Strives to Create More Entrepreneurs

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Kitchen table businesses will be exempt from business rates as part of a Government drive to create more home businesses.

Entrepreneurs who run their business from home will not have to pay business rates, under new legislation from the Government. Home businesses are to be given a boost by the Government as part of a drive to encourage more kitchen table start-ups.

Today, enterprise minister Matthew Hancock will launch the new Home Business initiative, making it easier for people to start businesses from home. The legislation is being introduced in response to research undertaken by the Department of Business, Industry and Skills (BIS) and entrepreneur organisation Enterprise Nation, which found that home businesses contribute £300bn to the UK economy each year.

According to this study, there are currently 2.9m of these home-based companies in the UK, equivalent to 59pc of all UK small enterprise. Home-based entrepreneurs currently contribute £1 out of every £11 of turnover generated by UK Ltd, the report claimed.

In order to encourage more start-ups to take the domestic plunge, the Government will cut the cost and bureaucracy associated with running a business from home. Entrepreneurs will no longer be required to file for planning permission to run a home-based business, no business rates will be payable on the majority of these home-based firms, and the Government will introduce a new tenancy agreement making it easier to run firms from rented accommodation. By removing the red tape required to run a home business, the Government is hoping to create a surge in home-based entrepreneurs over the coming years.

“There has never been a better time to start a business and even more people are choosing to start up from home,” Mr Hancock will say today at the launch in London’s Somerset House.

“Home businesses don’t just fire up the economic engines and create jobs, they turn dormitory towns into living communities, they keep our streets safer and by driving down car emissions, cleaner too.

“We know that starting up any business can be hugely stressful and that’s why today I am announcing that the government will change the law to make life easier for Britain’s home businesses.”

The study from BIS and Enterprise Nation, which was based on BIS population data and its poll of almost 6,000 small businesses, found that 70pc of new firms start off in the home. Since 2010, the number of home business in the UK has increased by 500,000. Around 1.1m home businesses have been trading for over 20 years. Many successful British entrepreneurs have touted the benefits of starting a business from home. Will Butler-Adams, managing director of Brompton Bicycle, said of the initiative: “The first Brompton bike was designed in a flat overlooking the Brompton Oratory in Kensington. Today, we make more than 50,000 bikes a year and export to 44 territories worldwide.”

Shaun Pulfrey, inventor of smart hairbrush the Tangle Teezer, added, “Tangle Teezer was a business that began from my home in Brixton and it was a great way to keep costs low when I was starting out. I welcome any support that makes it easier for more people to start and grow a business from home, just like we’ve done.”