Coworking, your own office or home: which is worth it?

If you work for yourself or run a small company, the question comes up sooner or later, often on a day when the washing machine is on its spin cycle right next to your desk: do I stay at home, rent an office or move to a coworking space? There is no answer that suits everyone. It depends on the work you do, your budget and how you work best.

Working from home

On paper, it is the cheapest option. There is no extra rent, no commute and your hours are your own.

The costs are there, they are just hidden in the household bills: more electricity, more heating, an internet connection that can handle video calls, a decent chair and desk. And some costs are not paid in euros. The line between home and work gradually fades, interruptions come more easily and there are weeks when you go days without talking to anyone from outside. Receiving a client in your living room is not always possible, or desirable, either.

There is also a tax point. Under the IRS (Portuguese personal income tax) simplified regime, part of the income from services has to be justified with expenses, and the Código do IRS says that expenses on property, energy, water or communications only partly used for the business count at just 25% (article 31(14)). That is the typical case for anyone working from home. Check with your accountant how this applies to your situation.

Your own office

At the other end of the scale is your own office, which gives you full control: the space is yours, you decorate it as you like and you can receive whoever you want. It makes sense when the team has reached a certain size or when the work needs a specific space.

The catch is that rent is only the first line of the bill. An office normally involves:

• a deposit and rent paid in advance, and contracts lasting several years with long notice periods;
• electricity, water and internet contracts in the company's name;
• cleaning, maintenance, small repairs and insurance for the space;
• furniture, equipment and, often, fitting out works.

Before you sign, add all this up over 12 months and compare it with what you expect to invoice. Rents vary a lot from area to area and from year to year, so work with real offers from the area you are looking in, not generic averages.

Coworking

Coworking sits between the two. It is a shared space where you pay a monthly fee for the place you use, and the price usually includes electricity, internet, cleaning and coffee, which means you know from the start how much you will spend. There is no upfront investment in furniture and no multi year contracts, and you can move up or down a plan as work picks up or slows down. On top of that, it separates home from work, there are people around and there are meeting rooms for seeing clients.

It has drawbacks too, of course. The space is shared, you do not fully control the environment and, on flexible plans, your spot is not always the same. For long calls or confidential work, check whether a meeting room is available.

A useful clarification: using a coworking space does not change your tax address. For an individual, the Lei Geral Tributária (General Tax Law) defines it as their usual residence.

Side by side

	Home	Own office	Coworking
Monthly cost	Low, but spread across household bills	High: rent plus all the bills	Fixed and known in advance
Upfront investment	Desk and chair	Deposit, furniture, equipment, works	Practically none
Commitment	None	Contracts lasting several years	Monthly or annual
Electricity, internet, cleaning	You pay and sort it out	You pay and sort it out	Usually included
Focus	Depends on the home and family	High	Good, with some background noise
Isolation	High	Depends on the team	Low
Receiving clients	Difficult	Yes	Yes, in a meeting room
Flexibility	Total	Low	High

How to decide

Start by working out 12 months of each option, with every cost and not just the rent. Then think honestly about how many days a week you really need to get out of the house and how many face to face meetings you have a month. Two meetings a year and two a week are very different situations. Finally, try before you decide: a day spent in a coworking space tells you more than any comparison on paper.

The My Desk example

At My Desk, in the centre of Maia, the Flex Desk plan costs €95/month (or €950/year) and gives you a shared desk from 9am to 6pm, with registered office and mail included. If you want a fixed desk and 24 hour access, there is the Dedicated Desk, at €150/month or €1500/year. To try it out, a Day Pass costs €20. 500 Mbps fibre internet, electricity, cleaning, water and coffee are included, and prices are exempt from VAT under article 53 of the Código do IVA (VAT Code).