Do You Need a License?

I once knew a guy whose great idea for a ‘home business’ was to run poker tournaments from his house. Needless to say, that didn’t last long once the police heard about it.

If you think you’ve got an idea that’s going to make you big money, there might be a reason why everyone else isn’t doing it – and that reason could be related to the law. Many types of businesses are strictly regulated and controlled by governments that require a license.

Gambling

However fun and profitable it might be to put fruit machines in your house, run a mini card casino or just invite the local old people over to play bingo, it’s almost certainly illegal without a license. Gambling is an industry that’s almost always strictly controlled – it might be fine to gamble privately with your friends (or, depending on where you live, it might not be), but as soon as you start running it as a business you’re on very dodgy ground. You’ll also find that most places have laws against for-profit lotteries – sorry.

Applying for a license to turn your home into a gambling premises is unlikely to succeed. If you wonder why, consider what would happen if people in your area could do that. It wouldn’t be pretty.

Alcohol

Yes, it seems odd to some people that you need a license to serve alcohol – after all, you can invite people round to your own house for a drink perfectly legally, can’t you? As soon as you start charging them for those drinks, though, the nature of what you’re doing changes drastically in the eyes of the law, and you’re going to need a license. If you don’t get one, then you could be heading off to jail for quite a while.

Again, you’re going to have trouble getting an alcohol license for your home, unless you’re holding some kind of event there and the drinking is just incidental. Alcohol licenses are usually subject to appeals from people who live near the premises being considered, and you can guarantee that your whole neighbourhood is going to turn out to say what a bad idea it would be.

Medics

If you plan to do anything medical, then you’ll probably need a license. When I say medical, I mean doctors, dentists, opticians, and even vets. You might think it’d be fine to turn your home into an ‘animal hospital’, but you need to be qualified and licensed. Of course, if you’ve previously been a doctor, dentist, or whatever, then you shouldn’t have too much trouble getting licensed to do the same thing from home.

Children

People get jumpy around children, and you’re very unlikely to be able to look after any as part of your business without jumping through all sorts of hoops. Just to be a nanny, there are all sorts of courses to take and regular inspections to go through. If you ever wonder why there’s a shortage of small-scale childcare, it’s because it’s so hard to keep within the rules while making any profit.

Food

If you’re going to sell food, you usually need to register, for hygiene and safety reasons – imagine if just anyone could sell you food, without any checks! For various reasons most local government agencies are especially strict if you plan to handle raw meat. It’s usually fine to sell cooked meat, but raw meat is considered more dangerous. Food licenses aren’t too hard to get, anyway, provided you have a relevant hygiene qualification and you’re willing to have your kitchen and products inspected at regular intervals.

More

This list is nowhere near exhaustive – it just covers some of the most common kinds of businesses that people think of. If you’re planning to do something more unusual, then you really need to check your local laws.

Should I Bother?

Most home business owners don’t know about the rules that apply to them, and don’t especially care either. Every day you operate in a regulated industry without a license, though, you risk being shut down, or worse. It’s only going to take one upset customer or neighbour to get you into big trouble – so unless you want to be worrying all the time, make sure you’re properly licensed for whatever you want to do.

Home Business Main Page    Next: Getting Help Starting a Home Business