Daughter has set up new business in our home. Are we eligible for any benefits?

General_Grant

DE_612183 said:

as she has a business - you will need to INVOICE her for whatever costs you have incurred - she can then pay you and claim those as expenses ( is she a Ltd co - or sole trader? ), however if she does pay you, you in turn have to declare that as income which will then be taxed.

In a roundabout way there will really be little gain.

I agree that actual costs should be invoiced to the business but as long as there is no profit to the parents (that is only actual assessed costs are charged) then there is nothing for HMRC to tax, is there?

General_Grant

MM2002 said:

prowla said:

No quite answers to the question, but some things which need to be considered.

• Has she got public liability insurance?
• I would think that the benefits would be in her ability to offset costs against tax due.
• Also, do your mortgage and house insurance allow running a business from the premises?

Hi, yes she has insurance and i have made mortgage and house insurance aware and am paying extra for this. Again, can I claim any of this as its not MY business, but costing ME?

Was public liability insurance  and other insurance very expensive for a 16-y-o running a beauty business?

ellenvan

Maybe you could put a separate meter in - then she could claim all her costs against her profits?

Is it a short-term arrangement before she gets her own premises? Is she aware she is not paying overheads and would have to figure that in usually?

theoretica

MM2002 said:

prowla said:

No quite answers to the question, but some things which need to be considered.

• Has she got public liability insurance?
• I would think that the benefits would be in her ability to offset costs against tax due.
• Also, do your mortgage and house insurance allow running a business from the premises?

Hi, yes she has insurance and i have made mortgage and house insurance aware and am paying extra for this. Again, can I claim any of this as its not MY business, but costing ME?

If you choose, as you have, to make a gift to your daughter's business then there is nothing you can claim. 

MM2002

DullGreyGuy said:

There will also be the question on if you have had planning permission for the change of use as presumably your currently only approved for domestic habitation. 

Curious to know which home insurer you are with that is happy with a salon being run in the property... most are happy with an admin only business but most run a mile for any business where customers will be coming on the property.

AS the garage is detached and less than 10 clients a day, there was no extra charges, just notes put on their system. Insurer was esure

lincroft1710

ellenvan said:

Maybe you could put a separate meter in - then she could claim all her costs against her profits?

Is it a short-term arrangement before she gets her own premises? Is she aware she is not paying overheads and would have to figure that in usually?

If there is a separate meter then daughter will have to have a business electricity tariff

bargainbetty

Obtain copies of your bills prior to the set up of the business, and compare them to the bills you are now receiving. Your daughter should pay the balance from her business revenues and receive an invoice from you for it for her tax purposes, 

The business should support itself in this way - not seek to claim benefits towards a standard business overhead. 

Alternatively, you could consider helping her find an affordable room/space in a serviced business centre, where bills would be either included or itemised. 

theoretica

lincroft1710 said:

ellenvan said:

Maybe you could put a separate meter in - then she could claim all her costs against her profits?

Is it a short-term arrangement before she gets her own premises? Is she aware she is not paying overheads and would have to figure that in usually?

If there is a separate meter then daughter will have to have a business electricity tariff

You can get private meters put on that just indicate how much has been used by a particular circuit - nothing to do with the power company. But if you are charging for electricity used you are not legally allowed to charge more than you pay.

billy2shots

Things have veered off a bit here. 

The OP is not asking how to split bills with their daughter. 

The OP wants to fund their daughter but wants to know if they can claim tax payers money to offset the costs. 

I'm thinking no. 

soolin

billy2shots said:

Things have veered off a bit here. 

The OP is not asking how to split bills with their daughter. 

The OP wants to fund their daughter but wants to know if they can claim tax payers money to offset the costs. 

I'm thinking no. 

It’s a definite no. Parents are either supporting daughter out of the goodness of their heart and at their own cost, or daughter takes over the bills (as outlined above) and runs the business properly taking into account the full costs. 

It might mean that the business makes a running loss for the first year or 2 until they find their feet, and it might then be possible to investigate whether there is a possibility daughter could legitimately claim any top up benefits. That all assumes of course that if taking full responsibility for all the bills that this is a viable business , it might turn out to be unable to provide a living wage , in which case daughter may have to consider looking for similar worki in a salon .