Depending on the type of business the company operates, it may need industrial premises, a general commercial or office space upon commencement of trading or during its life (as part of any expansion plans). The premises you occupy for your business could be either a property that you own already or intend to buy, or one that you intend to rent from the owner/landlord.
If you are going to rent premises it is important that the terms of the lease are appropriate for you: rent amount, frequency of payment, intervals of rent review, space occupied and access, permitted and prohibited activities and also that you understand your obligations such as insurance, additional outgoings and maintenance. Additionally, a lease once commenced will usually be for a period of years and the liability will continue to exist even if you subsequently decide to wind-up the company’s affairs.
You may, as a director of the tenant company, be asked to provide a personal guarantee of the company’s obligations under the lease. This obviously leaves you at great personal risk.
You may even be considering working from home. Apart from the very practical consideration of whether your home is suitable for the type of business you have in mind, you will also need to consider whether there are any restrictions against your business activity being conducted there: are there any planning use restrictions affecting the area? Does your lease or tenancy agreement prohibit operating a business there or do the terms of your mortgage say that the property cannot be used for a business? Does this invalidate your home insurance?
It will be important to check for these restrictions and, if necessary, obtain consent before you start or you may risk the business being interrupted it you are required to move or cease operating.
