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Lease agreement for home office

What needs to be included in a lease agreement for leasing a home office to a limited company? Also as it will be at a no profit to a related party does it need entering on the individuals tax return.

Thank in anticipation.

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Home rental agreement

Hi - you cover everything applicable to the client, here's the wording we used on a recent one:

It is agreed that in consideration for its use of the Home Office, the Company shall reimburse the Property Owners such proportion of any expenses they incur, providing it is fairly attributable to the use of the Home Office by the Company including (but without limitation) a proportion of mortgage interest, Insurance, Council Tax, heating and lighting costs, broadband connection, maintenance and repair. The proportion is to be agreed between the parties from time to time having regard to the actual use made by the Company of the Home Office.

Because it's rental it has to appear as rent & expense on the UK Proproperty pages, otherwise you run the risk of PAYE problems.

 

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Non exclusivity

I always highlight a non exclusivity clause in the agreement e.g

 

 

The company may use the premises during normal working hours as an office and outside of that for storage of equipment.

Mr & Mrs X may use the premises outside of office hours and for the storage of household items at any time.

 

It is my belief that this avoids any issues around a loss of PPR in the CGT calculation.

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