Value-creating economy is the new catchphrase as Singapore moves beyond SG50 into SG100. According to Minister Tharman Shanmugaratnam, the engine that will propel our economy into a more innovative and entrepreneurial one will be Small and Medium-sized Enterprises (SMEs). SMEs play an integral role in Singapore’s hope for homegrown, globally competitive Multinational Corporations (MNCs), which will elevate Singapore’s position in the global market.

Running a curry puff empire out of a HDB flat may not exactly be what Minister Tharman had in mind, but you have got to admit that Madam Robiah certainly had a robust entrepreneurial spirit. Unfortunately, she did not make headlines because of her entrepreneurial success, but rather because she ran into trouble with the Housing and Development Board (HDB) for running a large business in her flat (she had hired 8 workers for her curry puff factory). Her curry puff making was also found to be rather unsanitary, and the National Environment Agency (NEA) rightfully cracked down on her operation.

However, do not let this discourage you or put you off your plans to run a home business, because HDB actually does allow businesses to be run from the comforts of your own home. HDB has come up with two HDB home business schemes, namely the Home-Based Small Scale Business Scheme and the Home Office Scheme that allows this.

Having said that, there are of course rules and regulations in place that you need to follow if you want to run a business in your flat. Here are some of the important things that you must know:

The Schemes

Under the Home-Based Small Scale Business Scheme, HDB has outlined a list of permissible business activities on their website. These include sewing services, hairdressing, private tuition and so on. There are business types that are specifically prohibited, such as massage services (this one is obvious because there is a possibility of prostitution under the guise of massage services). Under this scheme, you will not need to seek HDB’s approval to conduct these business activities in your HDB flat.

Under the Home Office Scheme, HDB similarly has a list of permissible and non-permissible businesses. However, even if your business falls under the non-permissible category, you are still allowed to use your flat as an administrative office for your business, and you can register the flat with the Accounting and Corporate Regulatory Authority (ACRA) as the business’s official address. For this scheme, you are required to register your business with ACRA unless it is exempted under the Business Registration Act. This is because unlike the Home-Based Small Scale Business Scheme, the Home Office Scheme allows you to use your flat as a registered office space for your business.

The Rules

HDB flats are first and foremost homes. This is the overarching principle of the regulations laid down by HDB with regard to home businesses. As such, the rules largely revolve around ensuring that the residential “feel” of the estate is not compromised by the business. To highlight some of the more important rules:

  1. You are allowed to share your business on social media platforms, but you are not allowed to use paid online advertisements on any platform. Additionally, you are not allowed to put up paid advertisements around your estate or hang a business signboard outside your flat. This essentially limits your pool of customers to largely friends and family, whereby word-of-mouth is the best way to promote your business. The reason for such a restriction is because HDB feels that having advertisements pasted all over a housing estate will negatively affect the living environment of the estate.
  1. For the Home Office Scheme, there is a maximum limit of 2 non-resident employees working in the flat, while for the Home-Based Small Scale Business Scheme, no workers can be hired. This restriction is to ensure that the scale of business activities remain small, so that neighbours are not disturbed by ongoing businesses. If the business grows large, then you should move your business to a commercial space.
  1. You are not permitted to use your home office for goods storage. This is because goods storage will lead to an increased amount of human and vehicle traffic, where there will be loading and unloading of goods and a heavy usage of the lifts. This will lead to inconveniences for other residents.
  1. Your HDB flat cannot become a shop, bakery, tuition centre or hair salon. Basically, anything that will draw a significant amount of human traffic is prohibited. Again, the reason for this restriction is that high human traffic will inconvenience other residents, and the noise generated may disturb neighbouring units.

The Guidelines

For all aspiring food entrepreneurs, there is an additional pair of eyes watching you; the NEA. While it is true that home-based food makers are not required to apply for a license, it does not mean you can start using your back-scratcher as a rolling pin. Recall Madam Robiah; NEA is strict with errant home food-makers, so it is best to follow the hygiene guidelines stipulated by them.

Here are some of the guidelines that NEA has provided:

  1. The personal hygiene of the baker is of utmost importance, and it is a must to wash hands before and after food preparation. Also, NEA recommends wearing gloves during the food preparation and when handling finished baked foods.
  1. The hygiene of the kitchen is also important, and a clean kitchen is a requirement if you want to join a baking community. The community may assess the hygiene and condition of your kitchen before allowing you to join. NEA recommends all equipment and preparation surfaces to be cleaned regularly, so that the kitchen does not attract pests.
  1. The home baker should only get their ingredients and supplies from approved and reputable suppliers. In addition, there must be care taken to ensure that ingredients have been stored properly and at the appropriate temperature. Careful storage will prevent foods from spoiling or getting contaminated.

The Verdict

By all means, join the ranks of the bold and the pioneering, and contribute to the advancement of our nation. Being a home-based entrepreneur is a viable way to make money, and the flexibility afforded is invaluable to Mums and Dads who have to juggle work and children.

However, do operate within the confines of the law. It is not worth it to risk NEA and HDB coming after you, because the fines may be hefty and the punishments harsh (always remember Madam Robiah).

Otherwise, all the best in your business venture; may you be everything that Minister Tharman hopes for, and everything that Madam Robiah was not.

Naomi Choo
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