Home-based enterprises

The policy allows you to run several types of business and commercial enterprises as either exempt development or complying development, as well as using your dwelling as a home.

These business or commercial uses can be carried out within your dwelling or within the buildings that are ancillary to it, such as your garage, detached studio or other outbuilding.

The types of enterprises that are dealt with as exempt development or complying development are:

• Home business
• Home industry
• Home occupation
• Bed and breakfast accommodation
• Home‑based childcare.

Short‑term rental accommodation is regulated separately.

You can carry out these activities from within a dwelling as either exempt or complying development, if you meet the relevant development standards. Each of these land-use terms have specific definitions. You must meet the requirements in those definitions.

A dwelling may be used for a home business, home industry or home occupation as exempt development, provided it meets the relevant definitions. Exempt development cannot include food manufacturing, skin penetration procedures, home occupation (sex services), or sex services premises.

Home businesses and home industries must also comply with the minimum 30 m² floor area allowed under clause 5.4 of the council’s local environmental plan (LEP).

Councils may permit additional exempt home enterprise types in their LEPs. These operate independently of the State Policy where the LEP specifically allows them.

Home-based childcare

Certain homebased childcare activities are exempt development under the Transport and Infrastructure SEPP if they meet the definition and the general exempt development requirements. They cannot be carried out on bushfire prone land.

If the activity is on bushfire prone land, or does not meet the exempt requirements, it may be allowed as complying development under the same SEPP provided all standards are met. Otherwise, you must lodge a development application with council.

To operate a homebased education and care service, you must also meet Department of Education requirements. Visit Early childhood education or contact the Department for details.

Signage

One sign up to 1 m² is permitted for home business, home industry or home occupation. Bed and breakfast accommodation may install a sign up to 2.5 m².

Bed and breakfast accommodation

Bed and breakfast accommodation means an existing dwelling in which temporary or short-term accommodation is provided on a commercial basis by the permanent residents of the dwelling and where:

• meals are provided for guests only
• cooking facilities for the preparation of meals are not provided within guests’ rooms
• dormitory-style accommodation is not provided.

Bed and breakfast accommodation must have only four guest bedrooms, or the maximum number of bedrooms specified in the council LEP applying to the land, which will allow no less than three bedrooms to be used for this purpose.

Other development standards for bed and breakfast premises:

• The dwelling must have at least one guest bathroom.
• The dwelling must have a fire extinguisher and fire blanket in the kitchen.
• There must be at least one off-road car parking space per guest bedroom.

You cannot use your dwelling for bed and breakfast accommodation if it is on bushfire-prone land.

The policy allows you to install exempt signage on a property in a residential, rural or conservation zone. For bed and breakfast accommodation, a sign up to 2.5 m² can be flat mounted or painted on the exterior wall of an existing building, or on an existing boundary fence or wall.

Home business for the manufacture of food

Home business for the manufacture of food allows you to use your dwelling as a home business for manufacturing food for sale.

The development must:

• not involve changing the building use
• comply with AS 4674 – 2004, Design, construction and fit out of food premises. These standards provide details on minimum construction and health safety requirements for food preparation areas.

The premises must also comply with all requirements under the Food Act 2003 and regulations under that Act and the Food Standards Code. These documents contain more requirements on the design, construction and operation of a food manufacture premises.

Most businesses that sell food in NSW must officially notify food standards enforcement agencies of their food business details.

All food businesses in NSW must:

• hold a current NSW Food Authority licence (this applies only to specific food businesses in sectors covered by a Regulation under the Food Act 2003); or
• notify the NSW Food Authority of their food activity details.

This requirement also applies to other food businesses, including those involved in temporary events and businesses that sell any sort of food or food ingredient as any part of their business.

A private certifier will advise the local council of a home business for the manufacture of food within two days of the issuing of a Complying Development Certificate.

Alterations to dwellings

Alterations needed for home enterprises may be complying development if they meet relevant standards.

Conditions of approval

All complying development must meet conditions under the Environmental Planning and Assessment Regulation 2021, Schedule 7 of the State Policy and the Building Code of Australia.

Dwelling

A dwelling is defined as being a room, or group of rooms, occupied as a house, or home, or legal residence. This includes dwelling houses, semi-detached dwellings, attached dwellings, multi-dwelling housing, residential flat buildings, dual occupancies, secondary dwellings, and shop-top housing.

Home occupation

A home occupation is carried out by permanent residents and must not employ outside staff, impact neighbourhood amenity, display signage other than business name, display goods, or involve retail sales.

An example of home occupation is a solo trade photographer or graphic designer who provides service and products at home and online, which can also satisfy the requirements above.

This does not include bed and breakfast accommodation or sex services premises.

The definitions of home business and home industry are similar to that of a home occupation. The only difference is these businesses or industries may employ up to 2 people who are not residents of the dwelling.

Home business and home industry

Similar to home occupation, but may employ up to two non‑residents.

Home‑based childcare

Home‑based childcare is a family day care residence where one educator cares for up to seven children, with limits on non‑school‑aged children.