Planning on selling homemade food? Make sure you’re certified first!

Many people in the UK have experience with side businesses or have seen others share their experiences.

Besides e-commerce platforms, an increasing number of people have started small home kitchens to sell homemade food. From baking cakes to preparing marinated dishes, customers can place orders online directly with the seller, often without using a food delivery platform.

For home chefs, this significantly reduces labour and venue costs while generating extra income. Some people work full-time as students or employees during the weekdays and use their free time on weekends to pursue their passion and earn additional income.

But did you know?

Selling homemade food in the UK is subject to regulatory oversight, just like opening a restaurant. You must obtain the necessary certifications, fulfil your tax obligations, and may even be eligible for tax relief.

Selling homemade food in the UK

What Preparations Are Required?

Running a home kitchen business in the UK is not as simple as cooking a meal for yourself. You need to follow these steps to ensure legal and compliant operation:

1. Register as Self-Employed

A home kitchen business is considered a type of food enterprise. Whether you do it full-time or part-time, you must register as self-employed with HMRC within three months of starting your business.

Once registered:

• You can decide your working hours and methods (e.g. taking orders and preparing food);

• You earn income from selling food rather than receiving a fixed salary;

• You are responsible for tax obligations and business risks (e.g., paying taxes regularly and complying with hygiene inspections).

If your business turnover is small and limited to occasional sales, HMRC may still classify you as self-employed, requiring registration.

Registration Process:

• Visit the HMRC website and create a Government Gateway account (if you don’t have one);

• Fill in the self-employment registration form (provide your name, address, date of birth, National Insurance number, business type, etc.);

• Submit your application and wait for HMRC to send you a Unique Taxpayer Reference (UTR) number (usually received within 10 days);

• Use your UTR number to register for Self Assessment and submit a Self Assessment Tax Return annually.

2. Register Your Food Business

Under UK law, you must register your food business with your local council at least 28 days before starting operations.

Registration is free and does not require renewal. If you plan to operate in multiple locations, you must register with each local council.

Do not register too early.

If your food business is not yet ready for commercial activity, wait until it is about to start before registering at https://www.gov.uk/guidance/food-business-registration.

Operating a food business without registration may result in fines, up to two years' imprisonment, or both.

3. Apply for a Food Hygiene Rating

The Food Standards Agency (FSA) assigns a food hygiene rating ranging from 0 to 5 after an inspection. This rating assesses food safety and hygiene conditions.

Inspections typically occur a few weeks after you register your food business (often unannounced), and the results are published on the FSA website for customers to check.

Inspections cover:

• Food storage, handling, cooking, and refrigeration;

• Kitchen cleanliness, equipment hygiene, ventilation, and drainage;

• Whether employees maintain good hygiene practices.

4. Apply for Food Premises Approval

Depending on your business nature, you may need to apply for specific licences. You must apply if:

✅You handle raw or cooked meat, seafood, dairy, or other animal-derived foods and supply them to other businesses (e.g., supermarkets, restaurants)

✅You produce food in bulk and supply it to multiple locations instead of selling directly to consumers.

You do not need to apply if:

❌You only sell food locally (e.g., selling homemade food directly to consumers)

❌Your business is retail-based and supplies small quantities (e.g., small restaurants, home kitchens, takeaways)

❌You have already registered your food business and do not engage in large-scale food processing.

5. Establish an HACCP Plan

A Hazard Analysis and Critical Control Points (HACCP) plan is a food safety management system designed to identify, assess, and control potential hazards in the food production process to ensure food safety.

For more details, visit https://www.gov.uk/food-safety-hazard-analysis

6. Obtain a Food Hygiene Certificate

Before starting a home kitchen business, you must hold at least a Level 2 Food Hygiene Certificate and complete an accredited Level 2 Food Hygiene course to ensure you understand food safety and hygiene standards.

Requirements for Selling on Food Delivery Platforms

If you plan to sell via food delivery platforms such as Uber Eats, Deliveroo, Just Eat, or Panda Delivery, you may need to apply for an A5 licence, which covers businesses offering hot food for takeaway.

Additionally, consider purchasing Public Liability Insurance to protect your business against risks such as food poisoning claims from customers.

Taxation and Tax Relief

As a home chef, you must declare and pay taxes based on your income. Some tax reliefs may apply:

• Personal Allowance: As of the 2024/25 tax year, the standard personal allowance is £12,570, meaning individuals earning below this threshold do not pay income tax;

• Trading Allowance: Self-employed individuals can receive up to £1,000 in tax-free trading allowance. However, this does not apply if you jointly own or control a trading business with family members;

• Business Expenses Deduction: You can claim a portion of business expenses such as council tax, heating, lighting, phone, and broadband costs to offset tax liability.

If you run your home kitchen from a property you own, you may need to pay business rates for the portion used for business. Additionally, when selling your home, you might be liable for Capital Gains Tax on the business-used portion.

Some Advice from TB Accountants

This guide provides detailed information on starting a home kitchen business as a self-employed individual.

However, some people wonder whether registering a company for food sales would be more advantageous.

We would advise that this depends on your business scale, total income level, and financial planning.

Registering a company may be beneficial if:

• Your annual income exceeds £30,000, and corporation tax is lower than income tax;

• You want to separate personal and business assets to reduce personal liability;

• You aim to optimise taxes through dividend payments and legitimate business expense claims (e.g., kitchen rental, equipment, ingredients, insurance, marketing);

• You plan to expand your food business and establish partnerships with food suppliers and B2B customers.

Starting a business is never easy, whether it's a primary or secondary job. The registration process, document preparation, tax filing, and compliance requirements can be overwhelming. Don’t worry – our professional team is here to support you.

From self-employment registration and tax filing to company registration and financial planning, our experienced tax experts offer personalised services to help your business thrive.

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This article is intended as general guidance only, and does not replace any legal or professional advice.  For enquiries, please contact TBA Group via email or WhatsApp.