Commercial Property

We would always strongly recommend carrying out the full range of searches when either purchasing or leasing a property. In fact, if you are obtaining bank finance then it is usually a requirement of the lender.

There are a range of searches that we would recommend including local authority, coal, drainage, chancel repair liability and environmental searches to name but a few. Our team of experts can explain the nature of these searches as well as any additional searches that may be relevant to your transaction.

Stamp Duty Land Tax (SDLT) is payable to HMRC on purchases and leases reaching a certain threshold. The current SDLT threshold for commercial property is £150,000. For leases, the SDLT payable will be calculated based on the length of the lease term, the annual rent, and any premium paid for the lease.

Generally, SDLT is payable to HMRC within 14 days of completion of the transaction. If the correct amount of SDLT is not paid on time, penalties and interest will be charged by HMRC.

For freehold transfers the value of the transaction is taxed according to each slice that fits into the following tax bands:

Up to £150,000 there is no SDLT payable The portion from £150,001 to £250,000 attracts an SDLT rate of 2% The portion above £250,000 attracts an SDLT rate of 5% SDLT is also payable on some leases and this depends on the terms of the lease (i.e. how long the lease is for, the amount of rent payable each year and any lease premium payable), using the following rates:

Up to £150,000 there is no SDLT payable The portion from £150,001 to £5,000,000 attracts an SDLT rate of 1% The portion above £5,000,000 attracts an SDLT rate of 2% You should also be aware that if VAT is payable in addition to the purchase price, then the SDLT is payable on the whole amount of the price plus the VAT.

A deposit is paid to the seller's solicitor when contracts are exchanged. It is usually 10% of the property price but a different amount can be negotiated between the parties.

A lease is a legally binding commitment for a certain number of years and usually that term must run its course. However, circumstances can change throughout the term of the lease and there are mechanisms available to bring the lease to an end before the contractual term expires.

The most common way is to transfer ("assign") the lease to another party. This will usually be subject to your obtaining consent from the landlord who will usually want to check the new tenant's references and financial standing before agreeing to the transfer of the lease.

Alternatively, the lease may contain a break clause allowing either or both parties to terminate the lease before the end of the term, often subject to giving notice to the other party and conditional on all the sums due under the lease having been paid up to date. A break clause is not automatically included in all leases, therefore it must be negotiated before the lease is entered into to ensure it is included as a term of the lease.

Another option is to agree a formal surrender of the lease with the landlord but be aware that the terms of the surrender will be a matter of negotiation and the landlord may insist of a payment from you to agree this.

This will depend on a number of factors. The main element will be the amount of time spent on the work but the total price paid or the amount of the rental commitment will also be relevant. We are always happy to give an estimate of our charges and the various disbursements in advance of accepting instructions to deal with the matter.

This depends entirely on the work involved and it is difficult to give estimates of timescales. Once we have the details of a specific transaction, it is much easier for us to give an estimate of the timescale within which it will be possible to complete the matter. Teams of solicitors will act on large property transactions so when time is vital we can meet tight deadlines.

Most people accept that when buying a property they need a survey before committing themselves to the purchase. However, a survey can be just as important before entering into a lease. For instance, if the lease contains an obligation to keep the property in good repair, it is important to have a survey so that you are able to properly consider the potential costs of complying with this repairing obligation.

Very few Leases will allow for a rent suspension in these circumstances. The likelihood is that rent is still payable by you.

You could approach your landlord to ask for a rent holiday or to defer your rent to a later date or to pay monthly instead of quarterly, but they are not obliged to agree to this. If any rent concession is agreed it is important to document this by way of a Deed of Variation or a side letter.

There is the possibility that your current business interruption insurance will cover you for non-payment of rent under your Lease as COVID-19 is now officially a notifiable disease.