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The Growth of Garden Office Working

2020 has seen unprecedented levels of home working, for obvious reasons. Initial concerns over productivity, professionalism and technology have been allayed. When employers (directors, senior executives or business owners) were asked what unexpected benefits had been provided by working from home, 30 per cent reported that their teams have been more productive, while 35 per cent said they had been more collaborative. (Working From Home survey, Talk Talk, 2020.)

As a result, many businesses are now considering whether dedicated office space is necessary.

There are safety reasons to consider, as well as the cost savings involved. These include whether a small office offers sufficient space to allow social distancing and the need for employees to use public transport for their daily commute.

If working from home is to be a success, appropriate working space must be available to workers. This means moving away from the kitchen table or the end of a bed. The long term solution has to involve the right technology and the right environment. The ideal solution? A garden office.

Is a garden office for you?

Many business owners are considering this as a viable, practical option. Garden offices offer the best of both worlds providing the following benefits:

  • Time saving
  • Cost efficient
  • Improved work-life balance
  • Dedicated working space – away from the home
  • More flexible working hours

If you’re thinking that this could be the perfect solution for you, there are some key facts involving planning and accounts that you should be aware of.

  1. Planning Permission

Provided that certain limits are met (usually size and location) you may be able to build within ‘permitted development’. Your local authority’s planning department will offer guidance for your area.

Key aspects are the size, location and level of use. To fall within permitted development, your new garden office (which is classed as an outbuilding) must be ‘incidental to the enjoyment of the dwelling house’. This is arguably much harder to demonstrate if you have frequent visitors (such as wellbeing or coaching clients, for example) or employees based in your garden office. In these cases, planning permission is likely to be needed.

2. Business Rates

It is possible that changing your home to accommodate your business will incur business rates. Accounting web explains: “If business rates are applicable, then it may be possible to mitigate the costs with small business rates relief. This reduces the charge to nil provided that the business only uses one property, and the rateable value of that property is less than £15,000.”

3. Ownership

Personal or business ownership of your garden office dictates which costs can be recovered through your business.

Provided that you are not operating as a sole trader, you could charge rent to your business. This effectively results in the creation of a rental business, which will have an impact for any other joint owners of the whole property, such as a spouse or partner. Against this rental income the costs related to the business’ use of the garden office – such as heating, lighting etc – can be offset.

Alternatively, business-related running costs can be recovered as long as they are ‘wholly and exclusively’ for the benefit of the business operation. If you are a sole trader or partner working more than 25 hours a week at home, you can claim a flat rate allowance towards running costs.

“A garden office is a great solution for many business owners,” says Trina Haggerty, partner at Hargreaves Owen, Chartered Certified Accountants. “As with any big change, it’s important to prepare and fully understand the facts involved before going ahead.”

If you are thinking about building a garden office and would like to discuss the financial implications involved, please et us know. Our friendly team is here to help you.

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