Soletrader risk living with parents

entrepioneer

Hello all,

I care for parent while living and working from their home as a sole trader ( ebay and amazon ). My bank is registered at their address and I have registered with hmrc as self employed at my parent's address which is their property outright and under their name. As an online business I only use the internet. I do not have clients coming to the house, but have small sized stock delivered, collected and prepped from the house. Stock does not stay at the property for long.

I have not borrowed money from the bank and do not intend on getting into debt however if I were to scale my business and the worse case scenario were to happen i.e business debt, product liability etc will my parents be liable in terms of their assets or will the debt only fall on me? I do not have my own property as of yet and I do not want to implicate them in anyway but I need to make a living while being able to look after disabled parent who cannot be left alone. I have searched far and beyond online and surprised no one has asked or answered this kind of question as of yet.

Thank you all for you help.

Lewis:beer:

Owain_Moneysaver

Your parent(s) will not be liable for your debt.

However, if you have a court judgement against you, bailiffs can seize your possessions from the house, and may want to see evidence that items they want to seize do belong to your parent(s) otherwise they may assume they belong to you.

McKneff

Your parents should also inform their house insurers that a business is being carried out on the premises if they have not already done so

entrepioneer

Thanks lads. I appreciate taking the time to help. Not everything has a receipt so its baffling that bailiffs are able to come and take anything they please even though it is not my house but the property of my parents. Are these things they suspect to be mine or anything they see of value? As long as I don't get into debt my parents house are not liable? In terms of insurers if I am have been self employed for a few years and have not told the housing insurers because I simply did not know especially if it was just an online business could this cause implications? Thanks

PasturesNew

The trouble you'd have is that if a bailiff did ever turn up to seize your goods - they'd want proof that your parents' valuables belonged to them - and not many people have receipts for most of their belongings.

That's where things get sticky.

Your mum might have "a nice vase handed down from granny to mum and now to me" .... but if the bailiffs think it's worth £500 they'll whip it away as there's no receipt to prove it's not yours.

They have you over a barrel really....

entrepioneer

What is the best way to avoid this a sole trader? I like the privacy of sole trader but understand ltd protects you. Finances are nothing to brag about if I were to go limited. Not letting them inside the house help? Doors and windows locked? I will not get to this stage as I do not borrow money from a bank and use my own profits but products I sell has a risk in terms of public liability. Just want to make sure. Also it been a few years have not told house insurance. Can this cause problems when letting them know later like now? Cheers

00ec25

entrepioneer wrote: »

products I sell has a risk in terms of public liability.

really? then why on earth do you not have extensive and robust product liability insurance?

if you really think you are at risk then it seems that is what you should focus on, not irrelevant concern over your parents possessions

Owain_Moneysaver

You/your parent(s) must tell the house insurers that the house is being used for business premises including storage of stock. Otherwise the house and contents insurance may be invalid.

If there's a fire and the house is completely destroyed you/they could be left without anything and no insurance.

entrepioneer

Thanks for all the replies. I appreciate all advice even the critical ones. I was meant to work 9-5 after uni, but currently not an option because of my records. Business is a new experience. Balancing caring for paralysed parent and learning ecommerce is a challenge to say the least. Still learning. When I say risk products are food supplements. I am not earning a lot at the moment currently under the £11800 small earnings. Had contradicting information that as long as there is no clients and a few deliveries and collections from above earning it would not be a problem with some insurers. I will definitely let them know as well as look for product liability insurance. Low on funds atm.

jonesMUFCforever

Forget (for now) your worries about your parents home and possessions.
I would be more worried if you sold a supplement which made somebody ill so having public liability insurance is a must!
If you cannot afford this now what happens when or if a legal letter drops on your mat saying that you are being sued?

entrepioneer

Thank you for your reply. I will definitely look into product liability insurance. Any recommendations?

I thought that it if I was being sued it would fall on the manufacturer who supplied me and not me?

Please correct me if I am wrong. In terms of product liability insurance I should do the following: Notify housing insurance that business is being run from property as well as storage stock and get separate product liability insurance? Meaning that there would be business insurance via house insurance and a separate product liability insurance through another business insurance company?

Thanks,
Lewis