The Scottish Council for Voluntary Organisations is the membership organisation for Scotland's charities, voluntary organisations and social enterprises. Charity registered in Scotland SC003558. Registered office Mansfield Traquair Centre, 15 Mansfield Place, Edinburgh EH3 6BB.
Your ownership of the space
The specific way you own, lease or manage the space will depend on the circumstances where you acquire it. You may only have one option, or you might need to consider the best financial and legal route. We’ll help you understand some of the options, and the advantages and disadvantages of each.
Types of Tenure - Advantages & Disadvantages
Advantages
- Security of ownership
- Creates sellable asset
- Independence
- Can use the asset to help raise funding
- Not subject to service charges
- Freedom to improve or redevelop the asset, and to attract grants to do so (subject to planning, etc constraints, certain title conditions and the conditions of any security)
Disadvantages
- Expense of purchase
- Cost of repairs and insurance
- May not be sellable if in poor condition
- Land and Buildings Transaction Tax (LBTT) if charitable relief not given.
Useful links
Negotiated sale route map from Community Ownership Support Service (COSS)
Acquiring property for your charity section of the Weston Property Manual from the Ethical Property Foundation (specific to English property law but contains some relevant information)
Property Title Checklist for Community Organisations from COSS, which you can use with a qualified legal professional to make sure you're covering everything you need to.
In Scotland leases of over 20 years can be called “long” but terms depend upon what the parties have negotiated.
Advantages
- In some cases where agreed with the landlord, rent may be low or peppercorn (meaning very low or nominal)
- Longer leases may have few obligations placed upon the tenant, almost akin to ownership
Disadvantages
All leases:
- Expense of rent (which may increase at regular intervals) and service charge
- Restrictions on use, alterations and alienation (i.e. assignation, sub-letting, sharing occupation, charging)
Longer leases:
- If a premium is paid, expense, cost of repairs and insurance may not be assignable if the property is in poor condition
- Cost of dilapidations at the end of the lease
- Land and Buildings Transaction Tax (LBTT) if charitable relief not given (depending upon rent and term)
Model leases and guidance for Scottish commercial property leasehold transactions from the Property Standardisation Group
A glossary of lease and property transaction terms from Community Ownership Support Service (COSS)
A table listing the standard "heads of terms" for a lease agreement, with explanatory notes, from COSS
A list of lease provisions and their potential impact on the viability and sustainability of a project, based on feedback gathered from existing community spaces, from COSS
In Scotland, if an arrangement has parties, a rent, a duration and premises, there is a lease; however, licences to occupy are often used for a short term arrangement or where the premises are not “fixed”.
Advantages
- Opportunity to keep a building open
- Maintain usage levels
- Gives opportunity to build the business case
- Establishes level of community support
- Can ensure a conservation gap doesn’t open up
- Costs can be minimal
Disadvantages
- Restrictive in terms of use, alterations, etc.
- Disposal usually prohibited
- No security of tenure
- Difficult to get funding if licence too short
Community ownership
The Community Empowerment (Scotland) Act 2015 has a defined legal process for asset transfer, helping empower community bodies to take ownership of land and buildings and strengthen their voices in the decisions and services that matter to them.
The Community Ownership Support Service (COSS), delivered by DTAS, is a Scottish Government funded programme, providing Scotland-wide adviser-based support to community groups and public bodies undertaking an asset transfer via The Community Empowerment (Scotland) Act 2015.
To access the COSS service and support please see https://dtascommunityownership.org.uk/
There are two possible routes available to an eligible community body:
CAT provides community bodies with a right to request to purchase, lease, manage or use land and buildings belonging to local authorities, Scottish public bodies or Scottish Ministers, in a way that recognises the public benefits that the transfer will bring.
This right comes from Part 5 of the Community Empowerment (Scotland) Act 2015.
COSS resources on Community Asset Transfer at and support from a COSS advisor will provide assistance in project development and the CAT application process by:
- helping you determine that a need exists, your group is ready and willing and that it is financially viable.
- taking you through the nuts and bolts of making an application
- understanding the timescales involved
- preparing to make a request and what you need to do at each stage in the process.
A good starting point is the COSS Route Map document, which will assist you to plan the questions you need to ask and the steps you need to take at each stage in the process - from developing an initial idea to the final step of getting the keys to the building.
CRtB is a pre-emptive right for community bodies to buy land or property. It provides for those communities, who successfully register a community interest in land or property, to have the first option to buy when the registered asset is offered for sale. CRtB mainly applies to privately-owned land or buildings.
This right comes from Part 2 of the Community Empowerment (Scotland) Act 2015.
An overview of CRtB options is provided by COSS.
A good starting point is the COSS Route Map document, providing an overview of the tasks and process involved.
The Scottish Government's Community Land Team also has information on making a Community Right to Buy application and can advise and support you through the process.
Do you have the right structure to use these processes?
To use either a Community Asset Transfer or a Community Right to Buy, you need to be an eligible ‘community transfer body’ - this means you need a constitution that sets out the community you work in, that most members come from within that community, a statement of your aims and purpose and a guarantee that any surplus funds are invested back into the community.
In practice, if you are looking to pursue an asset transfer for a community space as an unincorporated community body, you must have an eligible written constitution and you are restricted to using the CAT option for a lease or license to occupy for land and buildings in public ownership. An unincorporated community body cannot pursue a CAT or CRtB to purchase the freehold ownership of an asset in either public or private ownership.
COSS have produced detailed information on eligibility criteria.
Getting advice
However you’re taking on a community space, it’s a good idea to get legal advice to make sure you have everything covered and understand the responsibilities and consequences of the route you choose. Relevant legal advice can include the drafting, review and negotiations of your specific property agreement, prior to formal agreement and signature.
Depending on the building, you may also want to speak to qualified professionals like surveyors too.