What Is a Business Premises Under the LEP and What are Some Examples?

If you're starting a new business or leasing a commercial space in NSW, you've probably come across the term “business premises” in your local council’s LEP.

But what does it actually mean under NSW planning rules?

And more importantly, do you need council approval to use a property as a business premises?

Here's what you need to know, based on real-world experience as a town planning and architectural drafting firm helping clients navigate the development application process across NSW.

1. “Business Premises” is a Defined Land Use Term Under the Standard Instrument LEP

In NSW, most councils use a standard Local Environmental Plan (LEP) that includes definitions for different types of land use.

“Business premises” is one of these defined terms.

Under the LEP, a business premises is typically described as a building or place used for the sale or hire of goods or services, and includes things like offices, banks, dry cleaners and hair salons.

It doesn’t include industrial activities or medical centres, which fall under different use categories.

Understanding this distinction is essential for getting DA approval or a Complying Development Certificate (CDC).

2. Common Examples of Business Premises in NSW

We’re often contacted by small business owners asking whether their use qualifies as a “business premises” under the LEP.

Some of the most common examples include:

Real estate agencies, Travel agencies, Beauty salons, Hairdressers, Clothing boutiques General retail stores.

In a recent case, we assisted a client in Ryde who wanted to open a laser clinic in a shopfront tenancy.

Because laser clinics are often considered a business premises or health consulting room (depending on the services offered), we provided tailored planning advice and a complete development application package to secure council approval without delays.

3. Not Every Zone Permits Business Premises Use

Just because a property is commercial or has a shopfront doesn’t mean “business premises” is a permitted use.

Your local zoning under the LEP determines whether this use is allowed with or without consent.

For example, a B2 Local Centre zone usually permits business premises, but a residential R2 zone does not.

This is where a planning consultant can provide clear guidance.

We recently helped a client in the Inner West understand that their desired location, while convenient, was not zoned to permit a business premises without a development application.

With the right supporting documents and architectural drafting, we secured DA approval through council.

4. Fitout and Signage May Also Trigger DA or CDC Requirements

Even if the use is permitted, any physical changes to the building, like internal partitions, plumbing for basins or external signage, can require additional approvals.

This is often where delays and cost blowouts occur.

Our firm handles in-house drafting and BCA-compliant design to ensure your application is accurate and compliant from the start.

This speeds up the DA approval process and reduces back-and-forth with council planners.

5. Why You Need Planning Advice Before Signing a Lease

One of the most common mistakes we see is business owners signing a lease before confirming whether their use is permitted and whether council approval is required.

This can lead to unexpected costs and long delays.

We always recommend getting early planning advice from a qualified planning consultant before committing to a site.

Recently, a developer contacted us after their tenant had moved in without approval.

We had to lodge a retrospective development application, which attracted neighbour objections and triggered a longer approval process.

6. Business Premises Use Can Also Impact Parking and Access Requirements

If your use generates customer visits or staff parking, councils may require off-street parking to be provided based on floor area.

This is assessed during the development application stage.In some cases, you may be able to seek a variation or justify the shortfall, but it requires solid planning justification and local policy knowledge.

We’ve secured DAs for business premises with zero off-street parking in locations with strong public transport access and nearby timed parking.

Understanding what qualifies as a business premises under the LEP is just one part of the bigger planning picture.

At Town Planning Sydney, we guide clients through every stage, from planning advice and site feasibility to architectural drafting and DA approval, helping you avoid costly missteps and get your project approved faster.