Can I run a business from home in Cape Elizabeth, Maine?
Yes. In Cape Elizabeth's residential districts a low-impact "home occupation" (at most 1 non-resident employee, no regular client or delivery visits, using no more than 40% of the home's floor area) is a permitted accessory use, but it needs a Certificate of Occupancy from the Code Enforcement Officer before it starts. A busier "home business" (up to 2 non-resident employees and limited added traffic) needs a conditional use permit from the Zoning Board of Appeals.
| Home occupation: non-resident employees | No more than 1 [1] |
| Home occupation: customer/delivery visits | May not regularly visit [1] |
| Home occupation: max floor area | 40% of the dwelling's floor area [2] |
| Home business: non-resident employees | No more than 2 [3] |
| Home business: added traffic | Max 2% of street's AADT or 10 trips/day, whichever is larger [3] |
| Home business approval (Residence A, B, C) | Conditional use permit from the Zoning Board of Appeals [5] |
| Certificate of Occupancy | Required before establishing either [6] |
Two tiers
Cape Elizabeth's zoning ordinance separates a home occupation from a more intensive home business. Both must be run by an occupant of the dwelling, inside the home or an accessory structure, and stay accessory to living there.
Home occupation
A home occupation may have no more than one full-time or equivalent employee who doesn't live there, and the business can't require clients, service or delivery vehicles to visit regularly [1]. It can't produce odors, fumes, dust, glare, noise or electrical interference beyond normal residential use. There can be no exterior change that alters the home's residential character, including a separate business entrance; the business may use no more than 40% of the dwelling's floor area; and outdoor storage of equipment or materials isn't allowed [2]. Home occupations are listed as a permitted accessory use in the Residence A, B and C districts, for example in Residence A [4].
Home business
A home business may have up to two non-resident full-time or equivalent employees, and it can't add more than 2% of the street's average daily traffic or 10 trips a day, whichever is larger [3]. The property must be the owner's residence for most of the year, parking and exterior changes can't detract from the neighborhood's residential character, and outdoor storage must be screened. In the Residence A, B and C districts, "home business" appears in the list of accessory uses that may be allowed only as a conditional use approved by the Zoning Board of Appeals [5].
Signs
Signs for either type must comply with the town's separate Chapter 21 Sign Ordinance [6], which we did not review.
Approvals
Establishing a home occupation or home business requires a Certificate of Occupancy from the Code Enforcement Officer [7]. Home day care has its own permit under Sec. 19-8-8.
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Next steps
- Compare your plans to the home occupation limits (1 non-resident employee, no regular client visits, 40% of floor area, no outdoor storage).
- If you qualify as a home occupation, apply to the Code Enforcement Office (contact details at capeelizabeth.gov) for a Certificate of Occupancy before starting.
- If you need more employees or customer traffic, apply to the Zoning Board of Appeals for a conditional use permit for a home business.
- Check the Chapter 21 Sign Ordinance before putting up any sign.
Common questions
- Can I run a business from home in Cape Elizabeth, Maine?
- Yes. A low-impact home occupation is a permitted accessory use in the residential districts but needs a Certificate of Occupancy from the Code Enforcement Officer before it starts. A busier home business needs a conditional use permit from the Zoning Board of Appeals.
- What are the limits for a home occupation in Cape Elizabeth, Maine?
- No more than 1 non-resident employee, no regular client or delivery visits, no more than 40% of the home's floor area, and no outdoor storage of equipment or materials.
- What is a home business versus a home occupation in Cape Elizabeth, Maine?
- A home business can have up to 2 non-resident employees and add limited traffic: no more than 2% of the street's average daily traffic or 10 trips a day, whichever is larger. It needs a conditional use permit from the Zoning Board of Appeals.
- Can I put up a sign for my home business in Cape Elizabeth, Maine?
- Signs must comply with the town's separate Chapter 21 Sign Ordinance, which the page did not review.
Maine state rules for home businesses
Maine has no statewide home-occupation law. Whether you can run a business from home, and with what limits, is mostly up to your town's zoning. A few state rules may apply:
- Sales tax registration: If you regularly sell taxable goods or services from home, you must register with Maine Revenue Services and collect sales tax.
- Home food businesses: Making shelf-stable foods (baked goods, jams and similar) to sell requires a Home Food License from the Maine Department of Agriculture, Conservation and Forestry. It costs $20 a year and needs an initial kitchen inspection. Foods that must be refrigerated need a commercial license instead.
- Family child care: A state law (30-A M.R.S. §4364-D) makes family child care providers a permitted use in residential zones, under the same zoning rules as a single-family home. As amended in 2026, towns must follow it starting July 1, 2027. State child care licensing applies separately.
- Shoreland zone: The DEP's model shoreland ordinance defines a home occupation as one clearly incidental to the home, with no more than 2 employees besides family members living there. It requires a planning board permit in Limited Residential, Resource Protection and Stream Protection districts, and a code officer permit in Limited Commercial districts.
What the ordinance says
- Sec. 19-1-3 Definitions, "Home Occupations" (1)-(2), Chapter 19 Zoning Ordinance (includes maps & appendices), p. 17
No more than one (1) full-time or equivalent employee who is not a resident of the dwelling unit shall be involved or employed on the premises on a regular basis in the business or professional use; 2. The nature of the business or professional use shall not require clients, or service or delivery vehicles, to regularly visit the premises;
- Sec. 19-1-3 Definitions, "Home Occupations" (5), Chapter 19 Zoning Ordinance (includes maps & appendices), p. 18
The square footage occupied by the business or professional use shall occupy an area no greater than forty percent (40%) of the floor area of the structure (as defined above) of the dwelling unit;
- Sec. 19-1-3 Definitions, "Home Business" (1)-(2), Chapter 19 Zoning Ordinance (includes maps & appendices), p. 17
Not more than two (2) full-time or equivalent employees who are not a resident of the dwelling unit shall be involved or employed on the premises on a regular basis in the business or professional use; (Effective February 7, 2024) 2. The nature of the business or professional use shall not increase vehicular traffic on the street by more than two percent (2%) of the current average annual daily traffic (AADT) or 10 trips a day, whichever is larger;
- Sec. 19-6-1(B)(4) Residence A permitted accessory uses, Chapter 19 Zoning Ordinance (includes maps & appendices), p. 69
4. The following accessory uses: (Effective August 13, 2025) a. Accessory building, structure or use. b. Outside athletic facility accessory to permitted use. c. Home occupation.
- Sec. 19-6-1(C)(3) Residence A conditional uses (list item), Chapter 19 Zoning Ordinance (includes maps & appendices), p. 70
3. The following accessory uses: a. Home business D. Prohibited Uses All uses not specifically allowed as permitted uses or conditional uses are prohibited within this district.
- Sec. 19-3-2(D)(1)-(2), Chapter 19 Zoning Ordinance (includes maps & appendices), p. 36
None of the following activities shall occur and no building, structure, or portion thereof for which a building permit was issued shall be occupied until after the issuance of a Certificate of Occupancy by the Code Enforcement Officer in accordance with Sec. 19-3- 4, Certificate of Occupancy: 1. an increase in the number of dwelling units in a structure 2. the establishment of a home occupation or home business
- Sec. 19-1-3 Definitions, "Home Business" (6), Chapter 19 Zoning Ordinance (includes maps & appendices), p. 17
All signs shall comply with Chapter 21, Sign Ordinance; and (Effective February 7, 2024)