Guide
Renting business premises
What to consider when renting commercial property.
Renting business premises is a significant commitment. Commercial leases are very different from residential tenancies and you'll have more responsibilities as a tenant.
- Lease length
- Commercial leases often run 5-25 years.
- Business rates
- You'll usually be responsible for paying business rates.
- Repairs
- Many commercial leases require tenants to maintain the property.
- Break clauses
- Negotiate a break clause to exit the lease early if needed.
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Get legal advice
Have a solicitor review the lease before signing.
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Check permitted use
Ensure the property can be used for your type of business.
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Negotiate terms
Discuss rent-free periods, break clauses, and repair responsibilities.
Business rates and reliefs
Business rates (non-domestic rates) are taxes on commercial properties. The amount depends on your property's rateable value and where in the UK you operate. Each nation has different relief schemes for small businesses.
Late Night Levy: Additional costs for premises selling alcohol after midnight
If your premises sells alcohol between midnight and 6am, you may have to pay an annual Late Night Levy to your local authority. This charge funds policing and community safety in the late-night economy.
Where it applies
Only 10-11 local authorities have adopted the levy (as of 2025):
- London: City of London, Camden, Islington, Hackney, Tower Hamlets, Southwark
- Outside London: Newcastle, Liverpool, Chelmsford, Nottingham, Bolton
Annual levy amounts (based on rateable value)
- Up to £4,300: £299/year
- £4,301-£33,000: £768/year
- £33,001-£87,000: £1,259/year
- £87,001-£125,000: £1,365-£2,730/year*
- Over £125,000: £1,493-£4,440/year*
*Higher amounts apply to premises primarily selling alcohol for on-premises consumption
Exemptions available
- Hotels (accommodation only - not bars open to public)
- Theatres and cinemas (alcohol only to ticket holders)
- Bingo halls, community sports clubs, country village pubs
- Premises in Business Improvement Districts focused on night-time economy
30% reduction available
- Active membership of approved schemes (Pubwatch, Best Bar None)
- Small businesses receiving rate relief (rateable value £12,000 or less)
Revenue distribution
At least 70% goes to police for late-night policing. Up to 30% retained by local authority for community safety and street cleaning.
Non-payment consequences:
- Premises licence or club certificate will be suspended
- No alcohol sales permitted during suspension
- Unpaid amounts recoverable as civil debt
- Minimum 2 working days' notice before suspension
Payment is due with your annual licence fee renewal, or within 14 days of a new licence being granted.