A Guide to Working from Home - Is it Viable For You?

by Melissa Jardine

Working from home can be fantastic in terms of saving money on commuting, working flexible hours and being in control of your work environment. However, you also have to enter it knowing there will be down sides. For example, your taxes are no longer paid by your employer, they’re paid by you and you’ll need to ensure this is carried out properly to avoid penalties. Also, working from home can make it easy for your social and work life to overlap so you need to set boundaries in order to relax.

If you’re thinking of working from home and want to weigh up the pros and cons, this guide lists both the many positive and negative aspects of earning money this way.

Extra comfort, no commute and your boss a safe distance away - working from home sounds great! But do the financial advantages outweigh the drawbacks? We look at if it's right for you...

How we work has changed greatly over the past few decades. Computers have become a central part of most jobs, but predictions that most of us would be working from home by now were wide of the mark.

Working from home requires independence and self-motivation, but it can suit some people more than office life does. We look at the pros and cons of working from home so you can work out if it's right for you.

Benefits of working from home

Cut your costs

One major benefit of working from home is cutting out the daily commute. This will reduce what you spend on the cost of running a car or paying for public transport. You'll also save time, cut your carbon footprint and ditch the stress of traffic jams or delayed buses.

You can save money in other ways too. Being able to wear what you want means you won't have to buy office clothes. It can also be cheaper to make your own meals instead of being tempted by eating out every lunchtime.

Work out the total amount you spend on working in an office each month to give an idea of how much you could save by working at home.

Control your working environment

Some offices can be very distracting, especially if your job needs concentration. If you work from home you can control your environment, so no more listening to other people's conversations or being asked questions every few minutes!

Greater flexibility

You'll also be able to work less rigid hours, as you won't need to base your day around when the office is open or when your co-workers are in. If you work with clients or colleagues, you'll still need to make sure you're available when they need you, but a little more flexibility can give you more time to deal with other commitments.

If you have young children, working from home can cut your childcare costs and give you more time to spend with them without losing your wages. This can be just as useful if you need to care for a relative at home too.

Working from home could be attractive if you're a retiree looking for extra income. It's also a useful for those who prefer interacting with people more remotely or anyone whose travel options are limited by disabilities.

If you want to work in an industry that doesn't have many jobs where you live but you don't want to move away, being able to work from home can open up your options considerably.

The costs of working from home

Home office costs

Working from home is likely to mean you'll need to cover extra costs that your employer would usually pay for. You could end up with higher heating and electricity bills if you spend more time at home.

You might also need to buy some of your own office equipment, and using your own computer for several hours each day might mean you wear it out quicker. It's worth finding out if your employer will contribute towards these costs or loan you equipment.

Insurance costs

Working from home could affect your home insurance, as some policies won't cover you if it becomes your place of work. Check your policy documents or ask your insurer if working from home will affect your cover.

Tax bills

If you work freelance rather than for a company, there may also be tax implications. You may have to complete a tax self-assessment, so you might need an accountant to help. If you'd rather try to handle it yourself, read our guide, Completing a Self Assessment Tax Return: The Basics.

Personal life and career

As well as the financial costs, swapping the office for home could mean losing part of your social life, not seeing other people all day and even becoming more sedentary.

You might find that communication is less personal when it's not face to face. You could even feel less appreciated than those working together, and you might be overlooked for promotions or opportunities.

If you want to work from home so you can look after your kids, think about how easy you'll find it to balance the two. If you'll be able to find the time and space you need to work without interruptions, you're more likely to be able to meet your deadlines.

Look out for scams

You must have seen them before, posted in the comments section of pretty much every website out there: "My sister makes £96 an hour on the internet. She made £16,558 last month just for spending a few hours on the internet each day."

Sounds too good to be true? Absurdly high wages for vaguely described work usually indicates that it's a con. If you're looking for a new job to do from home, it's important to avoid scams, which can be used to get hold of your bank details or personal information.

To find genuine work opportunities, look out for established companies with a real address, a detailed job specification and information about the job's pay, benefits and holiday.

How to work from home

Doing your current job from home

Since 30 June 2014, you now have the right to ask your employer to allow you to work flexibly. It only applies if you've worked there for 26 weeks or more but includes the right to work from home.

When you ask, focus on how it will benefit the company rather than why it suits you. If you're able to prove you'll still be able to get things done and explain any savings the company might make, this will help your case.

Finding a new job you can do from home

Whether you start your own business or work for someone else, there's plenty of work you can do at home, including:

• Childminding
• Customer support for a call centre
• Data input
• Freelance writing or editing
• Ironing, cleaning or baking for others
• IT support
• Medical transcription - writing up dictated medical notes
• Mending and washing clothes
• Representing a catalogue company like Avon or Betterware
• Research
• Selling online on sites like ebay
• Translation
• Web design

If you're practical enough, you could even make things for a living, whether it's handmade furniture or homemade jewellery to sell on a website like Etsy.

Use a jobsite and filter the results to only include those that allow you to work from home. If you'd prefer freelance work, sites like PeoplePerHour are used by individuals and companies looking for people to produce freelance work for them.

How to decide

Work out how your financial position will be affected by working at home by comparing how much money you'll save each month on things like travel and food to any ways you'll be worse off, such as paying higher utility bills.

Consider the effect it might have on your personal life and your family as well, as some people's personalities and home circumstances are better suited to home working than others.

Make sure you're comfortable with what working from home could mean for your career too - not being in the office as much is bound to make a big difference.

Finally, consider if a compromise is possible, such as working from home a couple of days a week. That way you can get the best of both worlds: the flexibility or working at home when you need to but without losing interaction with your colleagues and maintaining your presence at the company you work for.

Melissa Jardine worked in a busy marketing company for almost a decade before taking a step back into the world of working from home so she could spend more time with her family. When not working in her dining room turned office, she likes to go for long walks with her labradors.