Buying business property
Buying commercial property: concluding the sale
There are a number of steps you need to take before completing the purchase of a commercial property and you become the owner. Once you are committed to buying the business premises you will need to exchange contracts. This is when the solicitors representing the buyer and seller of the property post the signed contracts to each other.
Exchanging contracts when buying property
You will be ready to exchange contracts with the person selling the property when:
- both sides are happy with the contract and agree on the price
- the surveyor or solicitor has made all the necessary checks and land searches on the property
- any planning permission, if applicable, has been granted
- you have raised the necessary money to purchase the property
Once you have exchanged contracts, the purchase becomes legally binding.
Deposit for buying a property
If you are paying part of the purchase price up front - known as a deposit - you do this when you conclude contracts. Once the solicitor has received the agreed deposit from the buyer they will pay this to the seller. The deposit is non-refundable.
Completing the sale
Once the contract is agreed you can make arrangements for the completion date. You are then ready to complete the purchase and become the owner of the property. Prior to the completion date, make sure you have adequate commercial property insurance in place. On the completion date, your solicitor will hand over the purchase price - paid by the mortgage company or lender - to the seller's solicitor. Your repayments to the mortgage lender begin. See commercial mortgages and lenders.
Stamp Duty Land Tax for commercial property sales
You must pay Stamp Duty Land Tax (SDLT) if you are buying non-residential land or property. The current threshold for non-residential properties is £150,000. However, you must still send an SDLT return for most transactions under £150,000. You must send and SDLT return to HM Revenue & Customs (HMRC) and pay the tax within 14 days of completion.
How much you pay for SDLT will depend on how much you pay for the business property – calculate Stamp Duty Land Tax.
For further guidance see SDLT rates for non-residential and mixed land and property.
When there is a sale of a property within Northern Ireland the title must be registered in the Land Registry. There will normally be a fee due for this. Your solicitor can assist with the Land Registry.
Finally, your solicitor receives the deeds to the property. These are the papers giving details of the property and the owner. The deeds are then sent to the lender, if a mortgage is used to complete the purchase of the property.
Read further information about Land Registry.