How to make money from home in the UK: 12 business ideas

Remote work has become increasingly popular in the UK, with a fleet of digital tools making it simpler to earn money from home. With so many options, though, how can you be sure you’re choosing the right path?

Learning more about the opportunities available can help you make an informed decision. From insights into earning potential to identifying competition, the more research you obtain the easier it will be to make the right choice.

If you’re ready to learn how to make money from home, this guide will help. Discover ideas for small businesses, learn about passive income options and gain practical tips to manage your revenue.

How to make money from home: 12 ideas

When it comes to how to make money from home, there are plenty of small business ideas to inspire you.

To help you choose the right option, we’ve put together 12 business opportunities, alongside information on potential revenue and tips on how to get started.

1. Crafting and handmade goods

If you’re skilled at crafting or making handmade products, you could turn this into a successful home business that you can run from your dining table.

There are plenty of channels you can use to advertise and sell handmade goods. This includes online marketplaces, like Etsy, as well as through markets or by partnering with local shops.

For example, if you’re looking to make money from home by selling ceramic vases, reach out to local florists and interior shops to ask if they’d like to stock your products. 

To increase your chances of forming a successful partnership, be sure to:

• Develop a quick and comprehensive pitch that includes your product or business’ unique selling point (USP).

• Pitch your product in person to strengthen your relationships with shop owners.

• Bring a sell sheet - a professional document that outlines the key details of your product - and samples to leave with the manager.

You can also sell products from home through an online store. Having your own e-commerce shop provides a digital touchpoint for your business, enhances credibility and allows customers to browse and buy when they want.

When considering how to make money from home by selling handmade goods, factors that affect income include:

• The products you make and how many items you sell.

• How much space you have in your home to make, store and sell products.

• Whether you intend to work full-time or start a side hustle.

• Your pricing strategy.

• Your marketing strategy.

2. Start selling services from home

When exploring low-cost, high-profit business ideas that can be started from home, look into selling services online. This could include:

• Online consulting.

• Graphic design.

• Website development and design.

• Video creation.

• Social media management.

• Freelance writing.

Starting an online business requires you to market your skills with the right tools that suit your budget.

For example, after using a drag-and-drop website builder to create your site, you can look into cost-effective marketing solutions that you can carry out yourself. These might include:

• Implementing organic search engine optimisation (SEO) to gain online visibility without paying for adverts.

• Marketing your services via social media.

• Gaining clients by reaching out directly (such as via email or in person).

• Creating print media to display in local shop windows.

The income potential for online services can be high, too. A graphic designer, for example, has an average income of between £20,000 to £40,000, while a web developer can earn between £20,000 and £60,000.

3. Create a baking business

If you’re exploring small business ideas you can run from your kitchen, baking could be a brilliant way to turn your cooking skills into an income stream.

The fact that baking sweet treats has seen an increase of 9.8% in recent years does mean this is becoming a more competitive market. However, the rising popularity of home-baked goods could also indicate rising demand.

Through market research, you can uncover more lucrative niches for creative ways to make money. 

Almost 50% of UK consumers report making healthier dietary choices, for instance, with an increase in demand for high-protein products. 

Cakes with healthier ingredients and a focus on protein, therefore, could increase demand for your baked goods.

Once you’ve started your business, you could sell your baked goods:

• Through your online store.

• Through partnerships with cafes.

• At local markets.

• At festivals and food fairs.

• On social media.

4. Sell homemade kombucha

When exploring things to make and sell, a current industry trend is kombucha. This is a gut-friendly health drink full of good bacteria that support digestion.

Tesco reported a 65% increase in demand for kombucha, making it one of the most popular functional health drinks on the market.

There’s also a rising interest in homemade kombucha, which can be fresher and contain fewer additives than shop-bought options.

With a growing demand, brewing your own kombucha could be a profitable small business idea. It also has a clearly defined, health-conscious target audience, making it simpler to tailor your marketing to your consumers.

After perfecting your recipe, sell your drinks at markets, health food shops and online. As with any home baking business, it’s important to follow hygiene standards if you decide to make extra money by selling kombucha. 

Your kombucha may also need to be tested in UKAS-certified laboratories to ensure the bacterial cultures used are safe for consumption.

5. Bespoke balloon garlands and decor

Looking for a creative way to make money? If you have an artistic eye, you could start a business making and selling bespoke balloon garlands. You can tailor the size of your garlands to suit your space, making this a suitable business to run from home.

The party balloon market is expected to experience a compound annual growth rate (CAGR) of 4%, taking total revenue to almost £2 billion by 2031.

Balloon garlands are a lucrative sector of the balloon market. Bubblegum Balloons, for example, has displays ranging from £18 for a simple bunch to £300 for 2-metre garlands. 

When pricing your balloons, remember to factor in material costs, production time, and installation time. 

To learn more, take a look at our guide covering how to price a product.

6. Grow and sell plants

In the first quarter of 2023, British consumers spent £6.1 billion on plants and gardening products. 

If you’re exploring low-cost business ideas, consider growing and selling plants at local markets to tap into this thriving industry.

Plant propagation - the process in which a section of a plant is removed to create a new plant - makes growing and selling plants a cost-effective small business idea.

Once you’ve grown a wide range of healthy plants at home, you can use your existing species to create more products to sell, reducing overhead costs.

You can also start growing plants at home with very little space. Windowsills or a small garden will be sufficient to begin growing a range of plants.

If you have more space available, create a designated area - such as in your garden or a converted garage - to become an at-home nursery where customers can view your plants in person. 

Consider your customer’s shopping experience and offer payment security and cashless options with a card reader. Another option to sell your plants locally is social media. Post images of your plants and take orders, offering local delivery or letting customers come and collect their plants from your home.

On average, plant prices range from:

• Succulents: £3 - £20

• Shrubs: £3 - £15

• Heather: £2 - £10

• Flowering plants: £3 - £80

• Trees: £3 - £60

Aside from different types of plants, prices also fluctuate depending on species, the health of the plant, and how big it is. For example, a large tree will sell for significantly more than a sapling.

To maximise your income, it’s important to balance the time and resources needed to grow the plant with its retail cost.

To keep costs low and sell plants as a second income, you can sell through Facebook Marketplace. This platform is fee-free and focused on a local audience, removing the need for shipping costs.

7. Pet sitting and dog grooming

If you’re looking for animal-related business ideas from home, both pet sitting and dog grooming are great opportunities.

Pet sitting

Pet sitting involves looking after people’s animals either at your home or theirs. 

If you already work from home, pet sitting is a brilliant way to make money on the side. Before offering pet-sitting services, make sure you have the right equipment to look after animals, including:

• Pet food.

• A safe space for the animal to sleep, like a dog bed in a quiet area of your home.

• Toys and equipment for walking the pets if needed.

In the UK, you’ll also need a license to look after other people's pets in your home. Take a look at the government’s dog day care licensing advice to learn more, and check the requirements for animal licenses with your local council.

On average, you can earn £7,800 a year pet sitting. You might be able to earn more by working for clients with multiple pets.

Dog grooming

A dog groomer can offer a range of services, including:

• Bathing and drying dogs.

• Cutting hair.

• Styling hair.

• Trimming nails.

• Cleaning ears, teeth and paws.

You can also offer advice on coat care and grooming, giving your clients tips on how they can look after their dogs between visits. This added value often increases the chances of customer loyalty and retention. 

When setting up dog grooming at home, ensure you have a dedicated space to care for the animals. 

Ideally, this space would have a separate entrance to the main home, reducing disturbances to your living space. An outhouse in your garden or a converted garage is ideal for at-home grooming.

You’ll also need to invest in dog grooming tools, including:

• Clippers.

• Scissors.

• Nail trimmers.

• Dog-friendly shampoo.

• Brushes and combs.

• Ear cleaning supplies.

You’ll need to fit a dog grooming table and drying area into your at-home grooming area. Make sure the space is well-ventilated, too, making it easier to deal with dog hair.

You may also need a dog day care license to groom dogs from your home. If you’re unsure of the license requirements in your area, speak to your local council for more advice.

Dog groomers in the UK earn between £13,500 and £20,000. You can take payments for dog grooming in person using a card reader for cashless payments. 

You could also arrange to take card payments over the phone before the appointment, ensuring you’re paid prior to the services being carried out.

There are also opportunities to offer grooming for other pets, including cats and rabbits. 

8. Start a dropshipping business

If you’re looking into how to make money easily from home, consider dropshipping.

This is a passive income idea, meaning that after the initial set-up, your business will require very little maintenance. It comes with minimal overheads, is easy to scale and can be managed from anywhere - including your home.

How does dropshipping work?

Dropshipping is an e-commerce model that uses a third-party supplier to stock, package and ship the orders. The supplier might also provide customer service on your behalf.

When you start dropshipping, you’ll purchase products from your supplier and sign an agreement that outlines shipping details. 

You then sell your products at a higher price, creating a profit margin - the percentage of revenue you earn after expenses are deducted. 

Use secure online payment methods for a safe and reliable method to take client payments.

When a customer places an order, both you and your supplier will receive an order confirmation. The supplier then packs and ships the product.

As the merchant, your task will be customer acquisition. This is often done through an online store, on the supplier platform or via a third-party platform.

Amazon, for example, isn’t a dropshipping supplier but it does enable anyone looking to make money from home a way to sell using the dropshipping model.

You’ll also need a marketing strategy in place to promote your products and ensure customer loyalty.

How much money can you make from dropshipping?

Full-time dropshippers in the UK can make £2,000 a month. How much you earn will vary, though, depending on a range of factors including:

• The products you sell.

• Your expenses.

• Your marketing strategy.

• Your market competition.

• Economic fluctuations, including recessions.

• The reliability of your supplier.

If you’re looking for a business idea with a low investment, dropshipping is a great choice. You don’t need to invest in product development, space to store inventory or setting up payroll systems, creating very few overhead costs.

This makes it easier to break-even and generate a profit.

You still need to focus on choosing the right products and selling them at the right prices, however. This makes a knowledge of small business finances - including cash flow, working capital and profit margins - essential. 

We’ll take a closer look at these concepts later in the article.

9. Create short-form video content

Social media has introduced various new ways of how to make money from home online. This includes short-form video content.

Short-form video content is usually under a minute long. These videos are designed to be engaging, concise and entertaining, sharing valuable content quickly with a wide audience.

To film short-form content from home, you’ll need filming equipment including:

• A camera - this could be your phone camera or a higher-quality camera, like a DSLR.

• Lighting equipment.

• Screens to create a professional background - a green screen, for example, is a staple for greater editing control.

• Video editing software.

For those looking to generate an income from home, short-form content offers numerous benefits, including being:

• Cheaper and less time-consuming to produce than long-form videos.

• Easily shareable for a boost to your brand awareness.

• Easily formatted to suit a wide variety of social media platforms.

• More appealing to an audience with a shorter attention span.

In terms of monetising short-form videos, you can either use them to market your existing small business at home or as a standalone revenue stream.

The social media marketing industry is competitive, though, with 23 million TikTok accounts in the UK and over a billion worldwide. Instagram and YouTube, two other popular short-form video platforms, also have billions of accounts respectively.

To stand out, focus on creating popular content to engage your audience. The most popular social media video content includes:

• Music videos: start recording home-produced music videos, lip-syncing or dance content, or aim to secure a brand deal by highlighting your musical talent.

• Sports highlights: post-workout routines or clips from sports you can do in your living room or garden.

• Educational videos: create at-home tutorials, record your tutoring sessions, or offer free online lessons to generate a large following.

• Viral clips: capture funny or heartwarming moments in your life and post them online for the opportunity of going viral, which could quickly lead to income through advertisements and brand partnerships.

Make short-form content for clients

Monetising short-form video requires a large following. On TikTok, for example, you need at least 10,000 followers and 100,000 monthly video views to start earning money.

If you love producing video content but don’t have a large following, you could offer video creation from home as a service instead. This is an in-demand aspect of social media management that may offer a more reliable income. 

On average, full-time social media managers in the UK earn between £25,000 to £60,000 a year. You can take payments from home as a freelance social media manager by invoicing your clients or through online payment links.

10. Rent out your driveway

Another passive income option for how to make extra money for home is to rent out your driveway.

This is a low-cost business idea, requiring a driveway and a platform to market your space. It’s especially profitable if you live in a city, town or by a popular train line for regular commuters.

To get started, choose a peer-to-peer (P2P) parking app to advertise your driveway. Some of the most popular include:

• JustPark: an established platform for renting parking spaces that makes organising contracts and payments simple.

• ParkLet: ideal for longer-term rentals and a more reliable income, though it does take a higher commission than other options.

• Park On My Drive: a simple P2P app with low fees and the basic features needed to start renting out your driveway.

You can also choose to rent your driveway independently through a local Facebook group, a shop window advertisement or by word-of-mouth.

How much you can earn from renting your driveway depends on your location and demand in your area.

Stashbee - another P2P parking app - includes a feature that enables you to check average earnings based on your postcode. 

We took a look at different cities around the UK to give you a clearer idea of annual earning potential of renting out your driveway:

• London: £4812.

• Edinburgh: £1164.

• Cardiff: £624.

• Manchester: £1572.

• Liverpool: £1320.

• Brighton: £1812.

11. Try tutoring

If you have a specialised area of knowledge or experience teaching, you can run a business from home by offering tutoring.

This provides a flexible source of income, with the ability to fit lessons around your existing schedule. It’s smart to look into payment options for small businesses to learn more about how you can accept payments as an online or in-person tutor.

When tutoring from home, you can also work independently or with an organisation.

The Tutor Trust, for example, pairs tutors with schools and independent clients, making it simpler to find paid work. You’ll earn £22 for an hour-long lesson, with the potential for increased earnings if you’re a qualified teacher.

You can also work with a P2P platform like MyTutor, which allows you to set your own rates. Typically, you can expect to earn between £11 - £45 an hour.

12. At-home fitness instructor

If you have a suitable space in your home and a talent for sports, you could earn money by hosting fitness classes.

For example, if you’re an experienced yogi, start hosting yoga classes for your local community. Convert an existing space - like a garage or spare room - into a studio, or conduct classes in your garden throughout the summer.

If you have limited space in your home, consider offering one-on-one fitness instruction. You could market your classes to clients looking to build their confidence before joining group sessions, or customers looking for personalised guidance to improve their skills.

Another option is to offer video fitness instruction. This could be through online courses, YouTube videos, or live sessions with your clients. Before getting started, you’ll need:

• A suitable space in your home free from interruptions.

• A camera.

• Lighting equipment.

• A background screen.

• Sports equipment.

Take payments online using payment links or make in-person transactions simple with Tap to Pay.

Scaling your home business

Whether you’re exploring online business ideas or setting up a business at a local market, it’s important to create solid foundations for long-term success. 

Here we’ll look at key tips to remember as you build and scale your home business, including:

• Setting up your space to work from home.

• Organising your business finances.

• Tracking consumer trends and market demand.

• The legal requirements and tax considerations when starting a business.

Setup for working from home

When considering how to make money from home, UK entrepreneurs need a space that suits their business. To learn more, we’ve explored key concerns when working from home and how you can solve them.

How much space does your business idea need?

If you’re considering different hobbies that make money, space could be a deciding factor.

For example, a ceramics business idea will require a pottery wheel, kiln and plenty of storage. You’ll often need an entire room or studio to set-up a ceramics business. If you have to rent an external space, this should be factored into your small business budget.

A knitting business, on the other hand, might only need a space to store yarn and your finished products.

Finding a space to focus

Another consideration is concentration. Will you be able to focus when working from home? How can you limit distractions?

An at-home office is ideal, but there are other options. Focus pods, for example, can be placed in an existing room to provide a small, soundproof office for conducting business calls or working without distractions.

Noise-cancelling headphones can be used to boost focus. These block out excess noise, helping you concentrate while making money from home even in a busy household.

Organise your finances

For merchants learning how to make extra money from home, understanding and organising your finances is crucial. Some key concepts to be aware of include:

• Fixed expenses - costs that remain the same regardless of how many products or services you sell.

• Variable expenses - costs that vary depending on how many products or services you sell.

• One-time cost - an expense that isn’t regularly repeated, such as purchasing a piece of equipment from your home office.

• Accounts receivable - money owed to you that hasn’t yet been paid.

• Accounts payable - money you owe from activities related to working at home that haven’t yet been paid.

• Net cash flow - the difference between the cash you receive and the cash you spend over a given time period.

• Working capital - how much cash you need to cover day-to-day operations as you work from home.

Creating a record-keeping system

A record-keeping system is crucial for tracking your cash flow, meeting tax obligations and making financially informed decisions as you work from home.

If you haven’t already, set-up a bookkeeping system with these steps:

1. Track your income and expenses using a business account, spreadsheet or accounting software.

2. Create a digital storage system for your receipts, invoices and other financial documents.

3. Track your accounts receivable and accounts payable to avoid missing payments.

4. Update your records regularly to ensure your accounts match your bank statements.

Creating a small business budget

Alongside record-keeping, you can track your cash flow while working from home.

This also enables you to stay on top of your expenses, helping you pay bills on time and monitor your earnings. 

You’ll also be able to identify areas of waste, too, such as an automatic repeat purchase for a material you no longer use.

To help you create a budget and manage your money while working from home, we’ve put together these key steps to get started:

• Calculate your revenue from all of your existing income streams.

• Estimate future revenue based on data and market research, including the income insights we’ve shared in this article.

• List all known fixed and variable expenses in a financial analysis.

• Set aside an emergency fund for unexpected costs.

Make sure to review your budget regularly to adjust predictions based on actual income.

Keep tracking consumer demand

Demand doesn’t always remain the same. When earning money from your home, make sure you track customer behaviour so that you can:

• Adjust your approach to better align with current trends.

• Tailor any services or products you offer to fit what people want.

• Explore new ways to offer value from your home.

• Improve how you interact with potential clients or customers.

• Find the best ways to reach and connect with your audience.

For example, if you’re making money online selling wedding invitations, it’s important to understand shifts in design trends. 

You should also maintain a knowledge of what your specific target audience prefers, as this could vary from wider trends.

There are various strategies you can use to keep up with consumer preferences and trends, including:

• Conducting online market research.

• Monitoring trends and competitors on social media.

• Asking existing customers to fill out surveys on demand, preferences and trends.

• Conducting polls on social media.

• Analysing your sales data.

• Making it easy for customers to leave feedback via email, in-person comment cards and website contact forms.

Give your small business a sustainable edge

When looking at trends that could increase your small business income, sustainability is a key focus.

Eco-friendly values affect purchase decisions and how consumers shop, with almost 50% wanting sustainable products at prices comparable to non-sustainable alternatives. 45% also want brands to make shopping sustainably easier by offering plastic-free, compostable packaging.

Add an aspect of sustainability to your handmade goods - such as cardboard packaging or locally sourced materials - and you could see an increase in demand.

Legal requirements and tax considerations

When exploring how to make money easily from home, don’t forget legal requirements and tax obligations.

Understanding these obligations can help you avoid fines and ensure your home-based income is compliant with local regulations. This includes registering your income stream with HMRC. You can register as a:

• Sole trader.

• Limited company.

• Partnership.

After registering, follow the guidance on how to submit a Self-Assessment tax return with HMRC or year-end accounts with Companies House.

You may also need licenses and permits to earn an income from home. To learn more, read our guide on the legal requirements for starting a small business.