Live Work Network FAQ (Frequently Asked Questions)

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Questions

Answers

Question:

If my business fails do I have to move out of my live/work flat?

Answer:

This depends entirely on the arrangement agreed with the local authority when the property was built - and on the nature of your tenancy/mortgage. On the one hand you would expect to move out of a business unit if the business didn't work out. On the other hand live/work units are not just workspaces. If the unit is rented the answer will normally be yes, as the purpose of the unit is to provide a workspace. If mortgaged it will be more complicated. Either way it will be up to the local planning department to enforce against change of use

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Question:

Does anyone have a definition of what a live/work unit is? I am trying to convince the VAT authorities that I live in such a unit . Mine is a barn conversion with a percentage of the floorspace used for commercial purposes (as ordered by the local council). Helpfully the VAT office does not seem to have a definition of what a live work unit is, although they will let me have my VAT back if I can prove I live in one. It's a mad world.

Answer:

Paul

 This is all down to your local council. If you can show that your property is designated as live/work (and often the workspace element wil be designated B1 business use) then reclaiming VAt should be OK. There is no national definition, although there is a planning circular 03/2005 (search CLG dept website) which defines live/work as 'sui generis' (a use of buildings that is different to residential). Don't suppose the VAT people will care too much about this. A letter from the planning dept may do the job, with any conditions of use attached?

 


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Question:

Business Rating After 2 years paying domestic council tax only, my live/work residence has now had a non domestic rating carried out on the work element which amounts to a demand from the Council for £2500 pa. I can't afford this and don't agree with the rental assessment. I am told that some Council's don't ask for business rates on live/work units and some do - why is this and what can i do? I read somewhere recently that this could possibly contravene the Human Rights Act - is this true? Thank you

Answer:

It varies scheme by scheme and depends on the planning consetn granted. It seems odd to be asked for business rates years later rather than from the outset. Many councils offer discounts to small businesses. Have you checked if this can apply? Unfortunately, although it seems reasonable to apply business rates to a proportion of live/work floorspace, in some areas (especially London) the difference between business rates and council tax can be prohibitive. Councils should be incentivising live/work uses for environmental reasons (no commuting), so perhaps you should call for an approach to live/work unit business rates that has discounts to reflect this? Can't see human rights being an issue though as a live/work unit is indeed, partially, a business workspace

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