Every business owns property such as equipment, computers, furniture and vehicles that could affect both taxes and the value of its business. It’s essential that owners understand how this property could have an effect on taxes as well as business valuation.
No matter where you reside, living on commercial properties may or may not be legal depending on zoning laws in your region.
Zoning laws
Zoning laws provide local governments with a tool to regulate how property can be used by its residents and are designed to safeguard public health and safety as well as maintaining property values within communities.
The zoning system consists of different zones designed for residential, commercial, or industrial uses. Each zone may feature its own symbol and number to reflect any restrictions placed upon them – for instance a neighborhood commercial zone may permit only small convenience stores while box stores would likely not be permitted to set up shop there.
As a business owner, you should always be mindful of zoning laws when determining what’s legal on your property. A zoning permit provides legal permission for building projects to take place on your land.
Zoning laws not only provide regulations for development, but they also govern the physical appearance of buildings – this includes things like noise levels, parking requirements and design specifications.
Many cities and counties enact various zoning rules, usually found in city or county government documents known as ordinances. These laws aim to prevent businesses from erecting buildings that could pose a nuisance for neighbors.
Zoning regulations may restrict commercial activity to a single building or require that businesses within a certain radius of schools or places of worship. They could also regulate traffic flow within an area, for instance by restricting parking spots for retail stores and bars.
If a zoning law prevents you from opening the type of business you envision on your property, variance or non-conforming use requests may help ease perceived hardship or address an individual need that does not impose harm to the community.
Sometimes it may be possible for you to operate your business from within your own home, though in general residential zoning rules will likely be stricter than commercial ones.
Zoning laws for your commercial property can be an invaluable asset, helping ensure the best location possible and protecting it from being damaged by other businesses or properties. They’re also a great way of discouraging neighbors from complaining about any business you own or operate.
Lease agreement
When renting office space or other commercial property, business owners must create a lease agreement. This contract outlines both parties’ rights and responsibilities within the lease arrangement as well as terms and conditions to which both must adhere.
Business lease agreements are legally enforceable agreements between property owners (landlord) and parties who wish to use their space for an agreed upon period in exchange for rent payments; typically this contract will be written and include provisions to protect both parties if any issues arise during its term.
Commercial leases tend to be longer and feature more complex terms due to a commercial tenant’s more complicated needs that necessitate a more comprehensive set of conditions than with residential tenants.
Commercial tenants may wish to sub-let part or all of the premises, or alter its purpose beyond its original intended usage, which could alter its lease agreement terms; if these issues come up during negotiations between tenants, however, both sides could come together and find solutions together.
Base rent, deposits and operating costs are key components of a commercial lease contract; their due dates should be clearly stipulated within it, along with whether deposits can be returned at the end of their respective lease terms.
A lease term refers to the period during which a business can use and access property, including parking and other areas, without incurring additional rent payments. It could last anywhere from one to ten years or could even be shorter.
Letting you choose between 1, 2, or 3-year lease terms. It can be challenging to ascertain this without performing an in-depth inspection, so if in doubt contact the owner and seek clarification.
Landlord and tenant should discuss renewal options for the property; either automatically renewed or at their discretion; as well as how rental fees will be distributed among tenants.
Lease term
Businesses often lease buildings or large equipment they need for their operations, similar to how residential leases work – this contractual agreement between the owner of the leased property (known as “the lessor”) and those renting space (the lessee).
Commercial lease agreements typically define both the fixed rent amount and payment schedule for rented property, as well as who is responsible for expenses such as maintenance fees, utilities bills, insurance premiums and taxes.
Lessors may require tenants to pay a security deposit similar to home or apartment deposits as a safety net in case they do not pay rent on time, and as an insurance against their failure to comply with required payments such as rent. This enables landlords to recoup any money lost while renting out properties, while protecting themselves from lost income if their business collapses or the rented property becomes damaged and cannot be utilized by it anymore.
Many lease agreements include provisions requiring lessees to return leased property in good condition and repair prior to the end of their lease term, providing significant financial incentive for lessors who know they won’t have to spend time and money later trying to repair or replace it. This gives lessors peace of mind knowing they won’t spend as much on repairs or replacement costs in future lease terms.
Also, most commercial leases feature renewal periods or options to renew which allow tenants to extend their rental agreement for another term at a pre-determined rental rate. These renewal periods or options to renew are important features for large companies as it gives them confidence they’ll have access to their rented property for an agreed upon amount of time.
A business lease should include a usage clause, outlining what the tenant can and cannot do on the property and whether or not they are responsible for any damages caused by their actions. This could either be positively (allowing them to use it for certain purposes), or negatively ( prohibiting certain activities from happening on it). Without such restrictions, businesses could find themselves breaching their lease agreement.
