How does the lease working when buying a business?

Yes the lease continues. The Ltd company is the legal person holding it.

Big expenses can occure with the lease though, so you need to fully understand what the lease entails, you might be responsible for massive repairing costs at the end of the lease

Also buying the company can have problems, rather than buying the assets and starting a new company and getting the landlord to accept you taking over the lease may stop hidden liabilities talk to Clinton who is a expert on this matter and on the forum

The landlord may have a view that differs, especially if there was a personal guarantee involved too. Indeed the outgoing director may wish to loose said guarantee.

Chris Ashdown said:

... talk to Clinton who is a expert on this matter and on the forum

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Thanks, Chris.

@acrobat , as I advised in your other thread, you'd be better off starting a business than buying one. At this end of the market you're more likely to end up buying a lemon.

If you do want to buy then pay well for good advice and do not do anything without expert advice!

Leases can hide all manner of problems. As @Scalloway says, if the limited company holds the lease, you acquire the lease when you acquire the shares ...but, is there for example a PG from the vendor to cover the lease (as @kulture says)? The vendor will want to extricate himself from the PG and the landlord may not accept your PG in substitute (why would he spend money on lawyers, on credit checking you etc? What incentive or financial inducement are you going to give them to do this?)

But that's just the start of your potential problems. There could be disputes between the landlord and the vendor and a payment due from the company for some "breach" of terms. Or disputes between the vendor and neighbours. When selling a house you are legally required to disclose these disputes. Not so when selling a business!

The lease is but one tiny part of the deal!

The Byre said:

Often the real price of a business is not what is paid (before or after hand-over) but the hidden costs that come to bite the new owners in the bum.

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Heed that advice.

Buying shares is a highly risky activity and you should be prepared to spend thousands in fees for professional advice (and the advice may end up being that this is not a good business to buy! So you will have lost that money you paid in fees) Even investors who take advice sometimes come a cropper. I don't have high hopes of you pulling this off and not coming to regret it.

If you must proceed, get advice from a trustworthy business broker or someone smart and savvy in this field, like me (but note that I myself can't take this on as I'm fully booked up. Please don't PM me about it)

Good luck.