When it comes to renting a property for your small business, it’s important to have a solid and legally binding tenancy agreement in place. One popular option for small businesses in the UK is to form a limited company and enter into a ltd company tenancy agreement.

What is a Ltd Company Tenancy Agreement?

A ltd company tenancy agreement is a legal contract between an incorporated company and a landlord, detailing the terms and conditions of renting a property. This type of tenancy agreement is specifically designed for companies registered as limited companies in the UK.

Benefits of a Ltd Company Tenancy Agreement

There are several benefits to entering into a ltd company tenancy agreement:

1. Limited liability: The limited liability structure of a company means that the directors are protected from personal liability for any debts or legal issues related to the tenancy agreement. This provides peace of mind for the directors and potential investors.

2. Tax advantages: Renting a property through a limited company can provide tax advantages, as the rental income and expenses will be accounted for under the company’s tax structure.

3. Professional image: Renting a property through a limited company can give off a more professional image for your business, as it shows that you are established and have a solid financial structure.

Important Considerations

When entering into a ltd company tenancy agreement, it’s important to consider the following:

1. Corporate resolution: Before entering into a tenancy agreement, the directors of the company must pass a corporate resolution authorizing the rental of the property. This ensures that all directors are aware of the agreement and gives the company legal authority to enter into the agreement.

2. Guarantor: Some landlords may require a personal guarantor for the tenancy agreement, even if the company is registered as a limited company. This is to provide added security in case of any potential default on rent payments.

3. Rent deposit: Landlords may require a rent deposit as security against damages or unpaid rent. The amount of the rent deposit should be agreed upon before entering into the agreement and included in the contract.


If you’re looking to rent a property for your small business, forming a limited company and entering into a ltd company tenancy agreement can provide a range of benefits. However, it’s important to consider the legal and financial implications of this type of agreement and ensure that all parties involved are fully aware of the terms and conditions. Seeking professional legal advice can help ensure that the agreement is legally binding and protects the interests of all parties.