The growing demand for live-work homes could be stymied by the extra tax demands placed on people who live in them, according to the Peabody Trust.
The association has called for changes to the tax liability of people who live in homes that include purpose-built working space.

Last Friday's landmark ruling against the Inland Revenue by the Lands Tribunal, the legal body charged with deciding revenue cases, means the former is no longer able to require people who work from home to pay business rates as well as council tax, as long as they are not running a full-scale business.

But many live-workers are not affected by the exemption because their homes are designed for business use. They are still liable to pay expensive business rates instead of, or in addition to, council tax.

Peabody group development director Dickon Robinson said this could hamper start-up businesses and put people off using live-work units.

"We need something like this [ruling] for live-work units," he said. "They have real potential for business incubation, and if the government is serious about regeneration, then we expect them to do what they can to make the approach a viable option."

The Housing Corporation gave its backing to live-work units in a report this month (HT 10 October, page 10) There are currently 17 housing association live-work schemes.

A spokesman for the Valuation Office, which oversees business rates, said: "We will continue to treat live-work units as we always have done. Each one is decided on its own merits."

Source

Housing Today