Company or Private Let ?

Company or Private Let ?

13:08 PM, 25th May 2015, About 7 years ago 18

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One of our prospective tenants wants to have a company tenancy, but he wants his name on the tenancy as well.

He claims that this way he will benefit from the rent being deductible as cost and he needs his name on the tenancy agreement to enable him to apply for utilities.

For example like this: The tenant: Mr John Doe – Example Ltd. I am concerned that in case we will need to evict we will have a legal problem with the name(s) in the repossession procedure.

Has anyone got any experience and/or advice regarding this?

Many thanks

Charlescompany



Comments

by Charles Fonteijn

11:54 AM, 31st May 2015, About 7 years ago

Reply to the comment left by "John Walker" at "31/05/2015 - 11:25":

Hi,
Thank you for your comment. My main concern is in case I have to repossess. Will this be deemed by the County Court Judge a company let or a residential let? Although this man has a company he is basically a self-employed tenant working from home. The Judge might decide to disregard the company let and it will be deemed an AST.

by Ian Cognito

17:35 PM, 31st May 2015, About 7 years ago

Hi Charles.

I have previously used a document headed "Agreement for a furnished/unfurnished letting when a company is taking the tenancy of the property" which was based upon my normal AST agreement.

The agreement was between the Landlord (me), Tenant (company) and Occupier (person living there).

Due to some problems, "I served a Notice to quit" at the end of the 6 month break.

Thus far, it is the only time I have asked a tenant to leave and the only time I have let to a company, rather than an individual.

Coincidence? Maybe.

Good luck.

by money manager

18:17 PM, 31st May 2015, About 7 years ago

Angela Yes, and no. Unfortunately the migration of HMRC's website to the gov.uk site has meant, at least for now and probably the forseeable future, that the more detailed and supporting guidance has been lost. Anyone can, and should, still access HMRC's manuals which are accessed by it's own staff. I am increasingly of the view that the, no offence, dumbed down gov.uk site is intended to lead taxpayers to arranging and reporting theri tax position less favourably than they might. Take a look at the BIM (business Income Manual) http://www.hmrc.gov.uk/manuals/bimmanual/BIM47800.htm for the expenses topic.

by money manager

18:41 PM, 31st May 2015, About 7 years ago

Reply to the comment left by "Charles Fonteijn" at "31/05/2015 - 11:54":

Working from home! Isn't there a possibility (risk) that the tenancy could be deeemd a business (commercial) tenancy, giving security of tenure under the Landlord & Tenant Act 1954 (Partll)? The usual use of a company let (with the occupier as a licencee of the tenant) is for a company to deploy staff on possibly an away from home secondment and would not generally consitute a taxable benefit in kind on the individual. A one man limited company with no other business premises paying for the individual's own home would, I should have thought, be swiftly undone by HMRC. What might be better would be for him to have an AST and then charge his company for the use of his home. That wouldn't be quite as advantageous as the route he is asking for but it would should be acceptable to HMRC.

by Angela Cooper

10:11 AM, 1st June 2015, About 7 years ago

Reply to the comment left by "money manager" at "31/05/2015 - 18:17":

Money Manager, im not really sure what your point is? Im perfectly aware of these documents. You`ve no idea what i do for a living nor what household expenses i claim as part of this business. My point was that there is no reason for the lease to be in a business name as the tenant can claim back a % of expenses without the business name on the lease., The main point is does the lease allow for commercial use? Does the Landlords insurance allow for this? Also commerical use in a residential property could be a nusiance to neighbours. id walk away.

by Charles Fonteijn

10:37 AM, 1st June 2015, About 7 years ago

Reply to the comment left by "Ian Cognito" at "31/05/2015 - 17:35":

Thank you for your comments. Did you actually have to go to court to get possession? I am trying to find out how this company let is regarded by a County Court Judge when I need to do a repossession/eviction.

by Ian Cognito

10:48 AM, 1st June 2015, About 7 years ago

Reply to the comment left by "Charles Fonteijn" at "01/06/2015 - 10:37":

No, there was no need to go to court.

by money manager

10:54 AM, 1st June 2015, About 7 years ago

Reply to the comment left by "Angela Cooper" at "01/06/2015 - 10:11":

" My point was that there is no reason for the lease to be in a business name as the tenant can claim back a % of expenses without the business name on the lease". As was mine in my post immediately that replying to you. No offence intended, as you quoted the first level gov.uk page that may have been the extent of your knowledge; I'm pleased it isn't. I was merely trying to help.


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