Working from Home: Is it legal?

As consulting town planner, I am often confronted by homeowners demanding why they cannot conduct a business from their home or for that matter from any dwelling. It is normally the excuse that “everyone is doing it”. The question is always: Is it legal? As with many things in life, the answer is not so straight forward and therein lies the confusion for Joe Budding Entrepreneur.

As basis for what is to follow, I must just first dwell shortly on the subject of zonings. All formal towns are governed by a town planning scheme (also nowadays known as a land use management scheme) in terms of which each parcel of land or stand has a specific zoning or land use right. A zoning is merely an indicator of the restriction on the erection and use of buildings or the use of land. It underpins the general purpose of a town-planning scheme which is the co-ordinated and harmonious development of the area in such a way to promote the health, safety, good order, amenity, convenience and general welfare of the area. It can therefore be seen as the “agreement” between the collective community to respect and protect each other’s right to usage of property. It is the duty of the Municipality to enforce the town planning scheme and to ensure the approved zonings are respected.

Dwellings are normally developed by virtue of a zoning of “Residential 1” or “2” and is generally defined as a set of self contained habitable rooms, including a bathroom(s) and a single kitchen, for the purpose of residence by (normally) a single family. It prohibits the use of the property for business purposes, retail, industry, etc.

On the other hand, a zoning for “Business 1, 2, 3” or similar, makes provision for offices, shops, banks, restaurants, hotels, entertainment, limited workshops, etc, depending on minor variations in different schemes. It should be reasonably clear that the unintentional mixing of the residential zones and the business zones, will lead to the degradation of (usually) the residential character. As a side remark, I must mention that a more recent tendency in town planning is to provide for a so-called “mixed-use zone”, where sleep, work and play are intentionally combined to achieve a specific character. However, in the case where tranquil neighbourhoods are being infiltrated by business activities, residents are normally quick to respond and often illegal land uses are brought to the attention of the authorities.

Why then, do we see so many businesses in dwellings, if it is the duty of the authorities to enforce the town planning scheme and prevent illegal usage? The first answer is of course that the Municipalities generally have a lack of resources to regulate or actively police the areas. They greatly depend on whistleblowers in the community and only then respond. Secondly, there are many businesses that are actually being conducted legally.

Legal business in a dwelling house comes in three variations. Let’s start at the most elementary and for which you will need no permission from the Municipality. That is namely the typical micro business, such as a one-man show, part time business, accountant, attorney, GP or dentist working from a study or consulting room(s) in his/her own house. Most town planning schemes makes provision for the conducting of a profession or occupation from a dwelling house as a primary right, sometimes called a “home enterprise” provided certain criteria are met. Note that each town planning scheme may have its own peculiarities and conditions. Please consult with your local municipality on the details. Typical conditions may include:

• The principal of the business must be residing in the dwelling.
• The dwelling must be predominantly used for residential purposes. Often a limited area for the business is determined, such as 30% of the floor area with a maximum of (say) 60m2.
• Not more than the principal and two assistants may be employed;
• No goods may be displayed in windows and no large scale stockpiling on the erf;
• Sufficient parking must be provided on the site;
• No noise or other nuisance may be created. No workshop for vehicles, shops, entertainment, activities attracting traffic, manufacturing, etc;
• Any signs displayed may not exceed a certain size;
• If the business is a place of child care, not more than a certain number of children may be taken in (say) maximum of six.

The second type of legal business, is where a business owner wishes to exceed some of the requirements mentioned, such as larger floor space, more staff, more children in a child care facility, etc. In such a case the owner may apply to the Municipality for a consent or permission or discretion. Approval of such consent will impose the conditions and should the business is found to disregard such conditions, the approval may be withdrawn.

The third type of business premises is where an owner applies to the Municipality for the rezoning of the residence to convert it completely to a business building, but where in the discretion of the Municipality the owner is prohibited from demolishing the structure. A business such as this, which is sometimes called a “dwelling office” may be 100% converted internally, but without the external appearance being changed drastically. Normally this type of use is only allowed by the Municipality in very specific predetermined areas and often bordering on major transportation routes, as buffer to a neighbouring residential area. There is no obligation on any residential component in the structure, but for the uninformed passerby it may still resemble a dwelling.

In closing, just a word of warning: Before you embark on using your home as a business, please pay a visit to your local town planning office or speak to a consulting town planner. Since each municipality may have its own requirements, rules and bylaws, the above discussion cannot possibly cover all eventualities. Also by violating the requirements of the scheme, you will expose yourself to sanction with often dire consequence. I will later write more about this topic.