Published: 07/02/2024
The costs associated with selling a commercial property in the UK can vary depending on various factors, including the value of the property, the complexity of the transaction, and the professionals you choose to work with.Here are some common costs you may incur when selling a commercial property:
Estate Agent Fees:
•If you use the services of a commercial property agent to help sell your property, they will typically charge a commission based on the sale price. This fee can range from 1% to 2% or more, so it's essential to clarify the terms with your chosen agent.
Legal Fees:
•You'll need a solicitor or a conveyancer to handle the legal aspects of the sale. Legal fees can vary, and you may be quoted a fixed fee or an hourly rate. Additionally, you may need to cover expenses such as Land Registry fees, search fees, and other disbursements.
Energy Performance Certificate (EPC):
•It's a legal requirement to have a valid EPC for your commercial property before marketing it for sale. The cost of obtaining an EPC depends on the size and complexity of the property.
VAT:
•If your property is subject to VAT (Value Added Tax), it's crucial to consider this in your calculations. Commercial properties are often sold as "going concerns" where VAT may be applicable.
Mortgage Redemption Costs:
•If there's an existing mortgage on the property, there may be fees associated with redeeming or transferring the mortgage.
Marketing Costs:
•While not a direct transaction cost, you may incur expenses for marketing your property, such as professional photography, advertising, and promotional materials.
Property Clearance and Maintenance:
•Depending on the condition of the property, you may need to spend money on clearance or necessary maintenance to enhance its appeal to potential buyers.
Taxes:
•When selling a commercial property in the UK, you may be liable for various taxes. The notable taxes to consider other than VAT are Capital Gains Tax and Inheritance TaxIt's crucial to obtain quotes and clarify all potential costs with professionals involved in the process.
Working with experienced advisors can help you navigate the complexities of selling a commercial property and manage costs effectively.