Business Rates on hire of space?

Psyche Registered Posts: 187 πŸŽ† 🐘 πŸŽ†
I have a new client who is a photographer, she rents her home and has converted part of it to be a studio. In addition to using it herself she also rents it out for a per day hire fee, with equipment etc included in the hire fee. Would doing this incur responsibility to pay business rates? Would it be better (and fall within the realm of honesty) to just class this as income from equipment hire?

Thanks for any help!


  • Monsoon
    Monsoon FMAAT, AAT Licensed Accountant Posts: 4,071 πŸŽ† 🐘 πŸŽ†
    Regarding rates:
    In my understanding most councils will ignore use of home for business unless it's actually disruptive, e.g. a shop being run or lots of people coming and going.

    Technically I think the council ought to make the decision.

    While I couldn't possibly advise not telling the council, I am sure various people would take this course of inaction and, chances are, the council will never know.

    She rents, so CGT isn't an issue.

    Regarding income (thinking aloud):
    I'm not actually sure whether this is trading income or rental income. I think it would be ok to class it as equipment hire (as she probably isn't allowed to sublet under her tenancy agreement)... A bit of a grey area, choose one interpretation, write down why you chose it and stick with it, I think!

    PS I finally looked at your website/ FB group - what a great idea (as an ex goth I thoroughly approve!)
  • Psyche
    Psyche Registered Posts: 187 πŸŽ† 🐘 πŸŽ†
    Thanks for your reply. I would be inclined to think of it more as trading income, since it is connected with her trade of being a photographer. And they are not really subletting, no one is staying overnight, it's just use of facilities really.

    She has a claim for back Housing Benefit, I advised her she does not want to be claiming HB whilst charging for the use of the property, at the very minimum!

    Old goths never die, they just go a bit grey ;)
  • Monsoon
    Monsoon FMAAT, AAT Licensed Accountant Posts: 4,071 πŸŽ† 🐘 πŸŽ†
    Oh ugh, HB is a right pain in the butt! No, she really does not want to be confusing them, they have a heard enough time understanding the concept of self employment at the best of times..... :/

    I'm sure I would come to the same conclusion you have, were it my client!
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