If you own or manage a commercial property that is currently vacant, you may be familiar with the concept of business rates on empty properties These rates, also known as empty property rates or non-domestic rates, are taxes that are imposed by the local government on properties that are empty for an extended period of time The aim of these rates is to encourage property owners to either put their properties back into use or sell them to someone who will do so In this article, we will explore the intricacies of business rates on empty commercial property and provide you with guidance on how to navigate through this potentially confusing issue.
Business rates are an essential source of income for local authorities, as they help to fund essential services such as schools, hospitals, and emergency services However, for property owners, business rates on empty commercial properties can be a significant financial burden Unlike residential properties, which are exempt from council tax for up to six months when empty, empty commercial properties are subject to business rates from day one of vacancy, with some exceptions depending on the size and location of the property.
The amount of business rates payable on an empty commercial property is based on the rateable value of the property, which is determined by the Valuation Office Agency (VOA) The rateable value is an estimation of the annual rental value of the property as of a certain date, known as the valuation date The rateable value is then multiplied by the business rates multiplier, which is set by the government each year, to determine the amount of business rates payable.
Property owners should be aware that empty property rates are generally set at a higher rate than standard business rates This is to incentivize property owners to either occupy or dispose of their empty properties quickly However, there are some exemptions and reliefs available to property owners who are struggling to pay their empty property rates.
One of the most common reliefs available to property owners is the three-month exemption period business rates empty commercial property. This means that if a property has been empty for less than three months, it will not be liable for business rates After the three-month period has elapsed, the property owner will be required to pay the full amount of business rates unless they qualify for any other exemptions or reliefs.
Another relief available to property owners is the Small Business Rate Relief (SBRR), which provides a discount on business rates for small businesses with rateable values below a certain threshold In some cases, property owners may also be able to apply for hardship relief if they are experiencing financial difficulties and are struggling to pay their empty property rates.
It is important for property owners to be proactive in seeking out any available reliefs and exemptions, as failing to pay empty property rates can result in severe penalties and enforcement action by the local authority Property owners should also be aware that simply removing furniture or equipment from the property does not qualify it for exemption from business rates, as the property must be genuinely vacant and unoccupied in order to be eligible for relief.
Property owners should also be aware of their responsibilities when it comes to occupying or disposing of their empty commercial properties If a property is left empty for an extended period of time, it can become a target for vandalism, squatting, or other illegal activities Property owners should take steps to secure their empty properties and regularly check on them to ensure they are in good condition.
In conclusion, business rates on empty commercial properties can be a complicated issue for property owners to navigate However, by understanding the regulations and seeking out any available reliefs and exemptions, property owners can minimize the financial burden of empty property rates and avoid the risk of penalties and enforcement action If you are a property owner with an empty commercial property, it is essential to be proactive in managing your business rates to ensure compliance with the law and protect your investment.