A business address is used to determine the prime location of a business; it’s a place where a business can be found and communicated with for legal correspondence. When you are starting a business, it is often a logical decision to set your business at home. However, there are exceptions to this case.
Connecticut Business Centers, an all-inclusive office space provider, discusses whether or not you should be using your home address as your business address.
Should You Use Your Home Address for Business?
A business can use different types of addresses for its operations, and it can be a home address, post office box or prime location. When it comes to deciding whether or not your home address should translate to your business address when you are building your own business from the ground up, professionals generally recommend against it. Not only does it make the location of your home public, it also compromises your privacy.
What Does a Business Address Entail?
A business address is a crucial piece of information used for communicating with vendors and customers. It also entails almost all aspects and functions of your business, such as the following:
- domain name registration of the business;
- opening of bank accounts for the business;
- account opening with other stakeholders;
- direct communication with stakeholders;
- for bills, payments and invoices;
- and listing the company on the internet.
All of these activities associated with building a business make your home address unsuitable for business. You can utilize a P.O. box, mailbox or virtual office space address as an effective solution instead.
Why Is It Not Appropriate To Use a Home Address for Business?
There are practical and ethical reasons for not making your home address the official address of your business. Below are some of the personal issues that may arise:
- It makes your home address public. Many individual entrepreneurs are based in their residence, but that does not necessarily mean you have to register your residential address as your business address. If you do, your private address will be listed in the public registration system of companies, which can be viewed by any member of the public.
- It increases the number of cold callers. The rapid growth of cold callers is one of the main reasons you should not use your home address when dealing with business-related activities. You will also receive an increasing number of catalogs, brochures, junk mail and letters in your mailbox. Your family might have to open the door to strangers from time to time as your home serves as your registered office space — which is not only inconvenient but also a potential safety threat.
- It compromises the privacy of your family members. If you are single and live on your own, the risk of using your home address is less. On the other hand, if you are married with children, there can be adverse consequences of putting your residential address out in the open. Apart from cold callers, salespeople will take the opportunity to add your private address to their register.
Apart from personal issues, there can be legal downsides to using your home address for your business. Here are some examples:
- It may not comply with the rules associated with your lease or homeowner’s association. Some apartment complexes and condo developments do not permit business owners to carry out operations from home. If you reside in a condo, you will have to cross-check with the homeowner’s association you belong to and see through the pertinent procedures and applications. If you are renting a home, on the other hand, check the terms and conditions of your lease arrangement. You can request permission from the landlord to operate a business from your home and consider it as your official office space. As long as your business does not disturb the surrounding residents, there will not be an issue.
- There may be zoning restrictions. Entrepreneurs with flourishing businesses will also have to take into account the potential limitations imposed by certain cities. Some municipalities prohibit businesses from participating in home-based operations. Some laws regarding home-based and commercial businesses may also lead to a restriction on your business.
- It may impede the professional reputation of the business. Your loyal customers will understand the circumstance of your business being based at home. However, there may be the misconception that you need to have a proper address for your business to be regarded as professional. There is a high chance that new customers, vendors and stakeholders will perceive your business to be invalid when you use your home address for business. When you have an official business address, however, you can maintain your corporate reputation and receive other additional benefits.
- There are issues related to liabilities. Liabilities are a significant factor that all business owners need to examine. It is crucial that you keep your home and business office space address separate. This is because limited liability companies can retain limited liability for operations and debts related to their business. In case your home-based business encounters a legal issue, protection from personal liability will play a prominent role. In this situation, having your home address as your registered business address can be a disadvantage.
What Can You Use as Your Business Address?
If you own a home-based business, there are many alternatives to utilizing your home address. These include obtaining a post office box from the U.S. Postal Service or a mailbox through the UPS Store or using a coworker’s space address or a virtual business address. Nowadays, more and more businesses are using a virtual address as it allows them to have a physical address for their business in the state in which they operate even if they are situated elsewhere.
Contact Us for Virtual Office Solutions
Get a prestigious virtual office at Connecticut Business Centers in Stamford, Connecticut. Our home-based virtual office solutions enable home-based businesses to have access to professional offices and conference rooms, as well as full connectivity and support services, at a fraction of the cost of a full-time office space. Contact us directly at (203) 359-5600 or fill out our convenient online form to get started.