Defining Criteria and Management Regulations for Home-based Businesses

Mr Yip Hon Weng asked the Minister for National Development (a) what criteria define the scale size of home-based F&B businesses; (b) how are such businesses tracked to ensure compliance in areas like scale, neighbourhood impact and tax declaration; and (c) whether the Ministry will impose commercial-level regulations in areas like (i) hygiene standards and alcohol licensing and (ii) taxation for businesses that exceed specific operational or financial thresholds.

The Home-Based Business (HBB) scheme allows residents to engage in small-scale business activities within their residential properties. Such activities must not alter the residential character of the property, adversely impact neighbours, employ persons outside the household, or display physical signages. To safeguard residential amenity, the Urban Redevelopment Authority and Housing and Development Board monitor feedback from neighbours closely. Where a HBB operator is found to have breached the HBB conditions, agencies would require the operator to scale down business activity or take appropriate mitigating measures. In some cases, the operator may have to cease its operations at home and source for proper commercial premises.

HBB operators are also required to meet regulatory and licensing requirements that take into account the scale and nature of their operations. HBB operators require a liquor licence from the Singapore Police Force if they intend to supply liquor onsite or from their premises. Although there is no requirement for HBBs providing food and beverages to obtain a license from the Singapore Food Agency given their small scale of operation and lower food safety risk, these HBBs are subject to the Environmental Public Health Act and the Sale of Food Act, and they are required to ensure food sold is safe for consumption.

In addition, income derived from HBB activities is taxable. All businesses, including home-based ones, are required to comply with tax obligations. Our tax rules do not make a distinction between HBBs and businesses in other settings. To ensure tax compliance, the Inland Revenue Authority of Singapore (IRAS) runs regular audit programmes to identify non-compliant businesses that under-declare their income or fail to register for Goods and Services Tax. The public may also report any suspected non-compliance to IRAS.