Opening Studio Space – Practical and Legal Obligations

This Content Was Last Updated on March 10, 2024 by Jessica Garbett


What are the practical and legal obligations on opening a studio?

First, see also our guides to Legalities of Working as a Yoga Teacher and Running a Studio at Home.

This guide assumes you are taking on premises of your own.  Here are some of the issues:


Premises – will you lease or buy?

If you are leasing premises you will need to consider the length of the lease, break points, and rent reviews – you need to balance here the competing tensions of protecting your operating position with a longer tenancy, versus protecting you if things don’t work out with a shorter tenancy.  If you operate as a company, the landlord may want a personal guarantee for the rent.

If you are purchasing premises, do factor in legal costs and stamp duty, and bear in mind commercial mortgages are more complex than residential mortgages.

Whether you are leasing or buying, check the VAT position – the rent or purchase may have VAT on it, and this can make a big difference to the figures.  Sometimes the first instinct is to register for VAT to recover this VAT, however assuming the business is profitable its probably best not to register for VAT if your turnover is below the registration threshold (currently £85,000), because the VAT you will pay on turnover will exceed that you’ve recovered on the rent or purchase – you need accountants advice in this area.  See the case studies in our VAT Guidance, as these expand this point.


Planning Consents – you will need to check your premises have the appropriate consent for a yoga business, or take advice on whether this can be obtained easily.  Likewise Planning and Building Regulation Consents for significant alterations.


Business Rates – You will need to check the rateable value of your premises – you can do this online.

If the rateable value is less than £15,000 then Small Business Rate Relief should reduce the rates – to nil if £12,000 or less and then a tapered reduction to Rateable Values of £15,000, so long as you only have one set of premises.


Insurances – you will need to think about premises, contents / equipment, public liability and employers liability insurance, alongside teachers liability cover – see our guide to General Insurance


Staff – if you are employing staff, or using sub contractors, you will need to think about issues around employment contracts, Employment Status, workplace pensions (now compulsory), and Employers Liability insurance.  When budgeting, bear in mind the costs of staff holiday and sickness that you will need to bear for employees.

It can be tempting to make all staff self employed, but as our guide to Employment Status shows this is a matter of law not discretion.


Health and Safety – you will need to risk assess your venue for both staff and students covering fire, hazardous substances, first aid, electrical, slip and trip, emergency procedures and similar – although this sounds complex, its common sense. Our Guide to Understanding Health and Safety for Yoga Teachers has more on this.


Licensing for Music – see Licence to play background music (PRS)


Value Added Tax – see our Guide to VAT for Yoga Teachers.  If you have a busy schedule and maybe employ or sub contract other teachers then its easy to go over the VAT threshold, which is expensive.  There are some case studies in our VAT guidance which expand on these points.

Some planning may be possible to structure your operations more vat efficiently, eg letting sub contract teachers pay you a rent rather than your collecting student fees and paying the subcontractor, but this needs to be approached carefully to make sure it is properly executed and makes commercial sense.

Please be aware of the “Cliff Edge” effect of VAT and get advice early.