Home-based businesses usually allowed to operate from residential rental units
WHO PRACTICE LANDLORD/TENANT LAW AND OTHER AREAS OF LAW
Q: Now that our kids have moved out, my husband and I are downsizing. We are selling our house and moving to an apartment. For the past number of years, I’ve run a business out of our home, selling jewelry that I make by hand. Because we won’t own the space anymore, my husband is worried that I won’t be allowed to run my business from home. Is this something we should be concerned about? How should we go about dealing with this?
A: First, you should discuss your plans with your prospective landlord. Making your landlord aware of potential issues as early as possible is a good way of avoiding problems down the line.
Generally speaking, a tenant can operate a small, home-based business out of their residential unit, but you must be careful to follow all applicable government rules when doing so. The City of Ottawa’s zoning bylaw provides a number of restrictions on home businesses. It includes limitations on the size and type of the business, among many others.
For example, the space used for the business cannot exceed 25 per cent of the unit’s gross floor area or 28 square metres, whichever is greater. So, a room is probably fine for your jewelry-making, but if you need more space, it may be problematic. You are also not permitted to run a business that requires a business license, barring certain exceptions.
The bylaw also contains strict rules on where home-based business employees can work from. If your husband helps you with the business, then he is allowed to work on-site as an employee because he is also a resident. However, if you rent an apartment, you are not allowed to have non-resident employees working on-site. The bylaw also prohibits businesses that are run in apartments from serving customers on-site. If you rent a house, there are different rules that apply. If you break city bylaws or provincial or federal laws, you risk eviction, since your actions would be considered an illegal act.
From your description, it seems that you will be using the apartment primarily for residential purposes, and secondarily as a workplace. Based on that assumption, the Residential Tenancies Act (RTA) would apply to your living arrangement. However, if the situation was reversed, and you were predominantly using the space for your business, then the RTA would not apply to your tenancy, your lease would be considered commercial, and the commercial lease would govern your situation; the protections provided to residential tenants would not apply.
Assuming that your business does not substantially interfere with the landlord’s use of the property or with other tenants, then there should not be an issue. An example of grounds for which landlords would prohibit a business would be if it makes excessive or annoying noise, like if you were hammering metal consistently, or it releases fumes, like a smelter would. If your business becomes a nuisance, it might well violate the zoning bylaw as well.
In running your business, you are not entitled to cause damage to the rental property or disturb the reasonable enjoyment of the landlord or other tenants. These conditions apply whether a tenant is running a business or not.