The idea of running a business from home has been gaining popularity in recent years, and especially since the start of the COVID-19 pandemic, as more and more people have become used to working from home. Moreover, with restrictions on bricks-and-mortar shops, offices and other commercial establishments, running a business from home is the only way for many entrepreneurs to continue earning money.
With times being tighter than ever for many people, these handy tips will help you to keep expenses to a minimum as you run your business from home.
Use Affordable Technology Products and Services
Running a business from home requires certain equipment, and those transitioning from an office or store to an at-home set up will find that they need to make some changes. Besides implementing new policies, you will also be faced with some initial expenses like purchasing new equipment or signing a fresh contract for a technology product that is essential for your business.
If you are just starting out, it’s good to start small and not invest too heavily at first. If you look around, you can always find affordable payment services, software solutions and free marketing tactics such as finding leads on LinkedIn. You can always scale up as the business grows.
Claim Tax Deductions
Do your research or consult an expert so that you’re well-briefed on tax deductions for home-based businesses. The HMRC Simplified Expenses rule has a number of provisions for reducing your tax bill. You can claim deductions on many things, including office space, heating, lighting, and a range of other categories.
Furthermore, there are new additional allowances that have been introduced in light of COVID-19. Make sure you are well-informed on the rules and complete the necessary paperwork to get all the claims you’re entitled to – you’ll be surprised how those deductions add up!
Use Refurbished Equipment
In any businesses you run from home, you have a lot of freedom in how the office is set up. Your home office may not need to receiving customers if your work is entirely online. In such cases, your office equipment and interiors such as printers, computers, furniture and heating equipment only need to be functional. You can use refurbished equipment that works just fine even though it isn’t brand new and may not look very flash. This can bring down your capital costs considerably.
Leverage Cloud Services and Open Source Software
Don’t jump into expensive software or hardware systems without looking around first. You can find open-source alternatives for almost any kind of program you may need for your business, such as accounting software, word processor or design programs. Similarly, for hardware requirements like data storage or servers, you can use cloud packages at a fraction of the cost of standalone equipment.
Negotiate on Insurance
You may be eligible for discounts on just about any service your business needs, but you need to ask first! For instance, if you bargain enough, you may get a significant discount in your insurance coverage, as you are not operating from a commercial site. You can also consider a Business Owner’s Policy (BOP) which is suitable for many small businesses.
Employ Your Family
Your spouse is probably enthusiastic about your business and wants to help you. When your business operates from your home, they may be able to help you significantly. You can even hand over small tasks to your children, which is also a great way to teach them about responsibility and self-confidence early in life. Not only will this save you in wages, but family members are likely to be more dedicated than external employees, as they have a vested interest in your business’ success.
Use Freelance Services
When you need professional services, you can significantly cut costs by relying on less experienced, yet still able hands. You can find freelancers or individuals that may not have years of experience, yet work efficiently and responsibly. Employing freelancers on a per-project basis may also be much more cost-effective compared to hiring permanent part-time or full-time staff.
Be Vigilant with Regulations
It is important to remember that laws and regulations still apply when you’re running a business from home. Make sure you have proper registrations and licences in place and that your paperwork is up to date. That way, you won’t have to worry about fine and penalties later, which would be an unnecessary expense.
Running a business from home already cuts costs considerably compared to setting up a full office, store, or other commercial site. However, for any small business, especially in the early stages, it’s prudent to pay attention to the details. All too often, new business owners overlook the small things, leading to unnecessary expenses, which can add up! With a little care you can save your pennies, and the pounds will start rolling in.