Business rates on vacant property, also known as empty property rates, can be a major concern for property owners These rates are imposed by local authorities in the UK on non-domestic properties that are unoccupied The purpose of these rates is to encourage property owners to bring their vacant properties back into productive use and prevent them from being left empty for extended periods of time.
Understanding how business rates on vacant property work and how they are calculated is important for property owners to avoid any unnecessary financial burden In this article, we will provide a comprehensive guide to business rates on vacant property and offer some tips on how property owners can reduce or avoid these rates.
Calculation of Business Rates on Vacant Property
Business rates on vacant property are calculated based on the rateable value of the property The rateable value is determined by the Valuation Office Agency (VOA) and represents the estimated rental value of the property at a specific date The rates payable on a property are calculated by multiplying the rateable value by the relevant multiplier set by the government.
For vacant properties, different rules apply to the calculation of business rates In most cases, properties are exempt from paying business rates for the first three months that they are empty After this period, full rates will be payable unless the property is a listed building or is undergoing major repairs or structural alterations In these cases, a 100% relief may be granted for a further three months.
Reducing or Avoiding Business Rates on Vacant Property
Property owners can take several steps to reduce or avoid paying business rates on vacant property One option is to actively market the property for rent or sale By demonstrating that efforts are being made to bring the property back into use, property owners may be able to qualify for a 50% discount on their business rates.
Another option is to explore the possibility of applying for exemptions or reliefs business rates vacant property. Properties that are undergoing major repair works or are in areas designated for regeneration may qualify for relief from business rates Property owners should consult with their local authority to determine if they are eligible for any exemptions or reliefs.
Property owners may also consider applying for temporary use of their property to avoid paying business rates Class B exemptions are available for properties that are used for certain purposes, such as storing materials or hosting exhibitions By temporarily using the property for a qualifying purpose, property owners can avoid paying business rates for a set period of time.
Challenges of Business Rates on Vacant Property
Despite the availability of exemptions and reliefs, business rates on vacant property can still pose a significant financial burden for property owners The rates payable can vary greatly depending on the rateable value of the property and the location In some cases, property owners may find themselves paying substantial amounts in business rates on a property that has been empty for an extended period of time.
Furthermore, the process of applying for exemptions or reliefs can be complex and time-consuming Property owners may need to provide detailed information about the property and its usage to the local authority, which can delay the processing of their application In addition, there is no guarantee that exemptions or reliefs will be granted, leaving property owners with little recourse to challenge the decision.
Conclusion
Business rates on vacant property can be a significant concern for property owners, especially in a challenging economic environment Understanding how these rates are calculated and exploring options to reduce or avoid them is essential for property owners to mitigate the financial impact of having an empty property.
By actively marketing the property, applying for exemptions or reliefs, and considering temporary use options, property owners can take proactive steps to manage their business rates on vacant property However, challenges may still arise, and property owners should be prepared to navigate the complexities of the system to ensure they are not paying more than necessary.
In conclusion, staying informed and seeking professional advice when needed can help property owners navigate the complexities of business rates on vacant property and ensure they are making informed decisions to protect their financial interests.