A garden office
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The garden office part 1: Planning and rates

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Helen Thornley tackles the tax matters and other practical legal issues that may arise when a business operates from a pod building in the garden. It’s a big topic, so this is the first of a series of articles.

4th Dec 2020
ATT Technical Officer The Association of Taxation Technicians
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Homeworking has its perks and downsides, but the one of the keys to success is working out how to accommodate it on a sustainable basis. For some, the solution to space and family interruptions might be some form of garden office pod.

Planning matters

The idea of working in the garden is not a new concept. Roahl Dahl wrote his books in a hut built of bricks at the bottom of his garden. Constructed in the 1950s, Dahl’s writing hut cost the princely sum of £80. More recently, the ‘shepherd’s hut’ that David Cameron was reported to have completed his literary endeavours in was estimated to have cost in the region of £25,000.

In these articles I’m going to look at the new trend for free-standing garden office pods, rather than the bricks and mortar approach adopted by Dahl. I’m also assuming that the individual who is planning on constructing or installing the pod will use it to run their own business, either as a sole trader, partner, or as a director of a limited company.  So I will examine the potential tax reliefs for their business.

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Replies (6)

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By jford
05th Dec 2020 11:06

Thanks Helen. That’s really useful. I’m looking forward to part 2.

Thanks (4)
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By Rgab1947
07th Dec 2020 10:09

‘incidental to the enjoyment of the dwelling house’.

I can assure anybody that me having a garden office will certainly make me and my wife enjoy the house more. I tried using a bedroom. I wanted to stay married so got a garden office.

Its petty bureaucracy at it again.

I can understand if you have staff (Heh WFH is the idea) but for me going stir crazy with WFH in my garden office the last thing I need is a council official arguing business rates.

Its the new norm WFH in a garden office.

Thanks (1)
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By markabacus
07th Dec 2020 11:08

Thanks from me too Helen. Also looking forwrd to part II

Right coffee break over back t work those tax rtns won't do themselves LOL

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By LGrainger
07th Dec 2020 12:08

It is always worth checking out the planning position, particularly in a suburban area, where objections by neighbouring proprietors are more common.

The nature and scale of the building can also have a positive (not necessarily a matter of common sense) or a negative impact, if you come to resell your home.

For example just a few years down the road, an ill-maintained wooden structure (no matter how costly, initially) can deteriorate from asset-to-eyesore.

Then there can be removal costs. For example, ageing Portakabin-type buildings can be very expensive to remove, particularly if they have become hemmed in by trees and require an expensive crane (and insurance) to lift them. Even in our rural area on a flat site, it cost me approximately £1000 to have a substantial mobile home (used for stable staff) removed and disposed of. This type of building can be temptingly cheap to buy, simply because of removal and re-siting costs.

But worst of all for a suburban seller, the type of warranties that are now demanded by purchasers and their mortgage funders, coupled with the uncertainty of not having planning consent , can cause delays and uncertainty in completing transactions. So keep it as small as possible and make sure you can exhibit the required consents.

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By cfield
08th Dec 2020 10:10

Last time I looked at business rates for home offices, they were exempt unless a) it was specially adapted for business use (which excludes broadband connections), b) there is no public access, and c) the room retains some domestic use. The latter is also relevant for CGT purposes, assuming it is owned by the householder, not his/her company.

As I see it, so long as you use it strictly as a home office (no employees, no deliveries, no customers) keep some domestic use (just put in a TV or a bike), and don't turn it into a workshop, you should be OK on planning permission, business rates and CGT.

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By Justin Bryant
08th Dec 2020 13:01

Jeffery Archer wrote his novels in a funny folly type building in his garden at Grantchester. I once visited him there and he explained it all to me (before he got jailed I think). I guess it's always been popular with arty types.

I never liked Roahl Dahl novels as I got him confused with Gerald Durrell who wrote a very boring book that I was forced to read at school. Interestingly I saw in the news recently that I had a proper reason to dislike RD all along.

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