Trading at a Loss

[leedsCIMAstudent]

Not sure whether this forum is the correct place for this question or not:

A business (involved in storage of pallets) has just transferred to new, bigger (and more expensive) premises.

The business proposes that charges to its existing clients remain the same as in the previous building (due to contracts, and fear that these clients would go elsewhere), which in fact results in offering pallet storage at a loss.

The aim (hope) is that enough new business can be attracted (which would be charged at new, higher prices) to even out the loss.

Given that (at present) almost 100% of the companies' business is being traded at a loss, is this legal/legitimate? Does there need to be justifiable expectation that more (profit-making) business can/should be undertaken? Or is it solely a decision for the shareholders?

Assuming the company carries on trading (at a loss) for say 6 months/a year, could there be issues from HMRC regarding claiming justifiable business expenses (i.e. as a loss to hopefully mop up in a future year) and indeed with the value of VATable purchases exceeding VATable supplies?