Top tips for arranging a co-working space.

noideaThought I’d note down a few of my discoveries pertinent to organising a shared co-working space as they may be useful to other people.  Treat the picture above as a clue. I am, quite clearly NOT a commercial property solicitor, tax accountant or small business advisor so for Christ’s sake get independent advice specific to you. Seriously dude, I just spent a week writing about goblin mythology in Spain. 

1. Lease

You’d think a space you’re paying for can be used by anyone you want to let through the door, but this isn’t the case.  Lease terms will vary and although you might be able to negotiate, you might not.

I very much wanted to have the lease in my name, not least as I am a control freak, and I also suspected it might make some elements of admin easier.  I was happy to arrange to sub-let the space to the other guys and anyone else who comes along, Tralee tralaa!  Imagine me as that Sound of Woman nun running through the mountains chucking doves at people…  but it transpired that the lease is very clear that subletting isn’t allowed.  This pissed on my doves; truly a great pity.  Piss-soaked doves are always a hindrance.

After a little diversion where we tried to get the solicitor to include a sub-letting clause, (and whereupon I think they decided  I was it was too much trouble for what is essentially a room the size of a bathroom) we changed the lease to be in all of our names.  Much back and forth but it’s all done.  This means we three can all share the space but unfortunately no one else can at the moment.  This won’t rule out the ideas we have had for doing something along these lines in the future.  One thing at a time though.

So anyway!  We’re all on the lease.  That’s cool.  We got a nice picture of us all signing the document nervously, whilst some dude rapped at us.  Well this is Digbeth.

2. Business Rates

If the space is an office, i.e. not a residential property, then it will be liable for business rates. You might be able to get an exemption but how long that lasts is uncertain.

Even weeny offices are liable for business rates.  As I understand it, this relates to the type of building they are not what you plan to do inside.  If you wanted to rent an office to hide some items in just to piss off an enemy, and didn’t even plan to stick around to gloat at the items, the space is still liable for business rates.

In case this is already too technical (I had no idea really) business rates are like council tax.   The office we are renting has a “rateable value” of 2,400 a year.  This isn’t the business rates though.  It’s like the “Band” of your council tax.  There’s a kooky little calculation which magically turns that figure into 1,000 a year which is the bit Birmingham City Council would be expecting on a direct debit.

Fortunately if the office is the only one you’re renting, and it really is titchy tiny (technical terms here), you might be able to apply for a small business exemption through your local council which makes the figure to pay nil.  Or it does until the law changes in March 2015 when the whole nil thing might be revoked.  Something to look forward to there. Anyway.  I’ve got the paperwork in for the exemption so hopefully that’s that for now.

3. Insurance

What needs to be insured?

If more than one business is running out of one office then obviously it’s up to those businesses how they insure their own stuff and cover their own business liabilities.

If your co-working might involve other people popping in ad hoc and sharing the space then it’s probably sensible to factor in insurance that covers them and what they’re doing.  In addition the lease, might insist on particular things being covered for loss and these might be a massive pain in the arse to accommodate.

FOR EXAMPLE: Our lease insists that the glass in the windows has to be insured but doesn’t care what else happens as long as any other damage is made good.  Now I don’t know if you have tried to get a grand’s worth of glass in an office insured WITHOUT them bundling in about 5 million quid’s worth of other business costs (no joke) but it’s almost impossible.  It’s most likely cheaper to set aside the cost of the windows; presuming you know the value of the windows.

Anyway.  I now know the value of the windows. If you happen to visit us (and I hope you do), don’t break the windows.  Don’t even go NEAR them, ‘k?

4. Electricity!

We do a meter reading when we get in and I have a supplier in mind who seems cheap.  Yay.    It can’t possibly be that simple can it?

5. Phone & Broadband!

Phone and intertubes should have been straightforward but the packaged deal from our landlord has just doubled in price and so I am now on a quick detour into finding an alternative package.  This isn’t actually difficult and will probably end up being much cheaper than we thought.  A likely win there so nur.  No advice there really other than expect prices to change right up to the minute you sign on the line for them.

6. Tax!

Basically, get advice on this one.  Some people group together, and set up as a company to administer the co-working space.  Others arrange their businesses/affairs separately and come to an arrangement for the sharing of lease and bills.

As a space-sharing individual, It seems you don’t have to set up as a business especially just to use the space if you are using it to get some peace and quiet and/or to undertake work for which you’re already paying income tax.  If however you are expecting an income that isn’t currently taxed as part of your shiny new office project you definitely should be telling the tax office, not least as you may be able to claim lots of things you buy for the office back against tax.

If you’re not really a new business and the space is just the aforementioned peace and quiet/enemy possession concealment, don’t expect HMRC to be too happy about you setting up as a business and claming these breaks whilst essentially running losses as all you pay out is rent and utilities and nothing comes in.

Did I say get advice?  Yeah, do that.   And don’t listen to me.  Even my stuff on Spanish Goblins has to go through a verification process.


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