Empty commercial properties can be a headache for any business owner or property investor Not only do they pose security risks and potential maintenance issues, but they also come with a hefty financial burden in the form of business rates However, understanding the intricacies of business rates on empty commercial properties can help mitigate these costs and potentially save you money in the long run.
Business rates, also known as non-domestic rates, are a tax on commercial properties in the UK They are calculated based on the rateable value of the property, which is assessed by the Valuation Office Agency (VOA) The rateable value is determined by factors such as the size, location, and usage of the property Business rates are used to fund local services such as roads, schools, and emergency services.
When a commercial property becomes empty, the responsibility for paying business rates falls to the property owner This can be a significant financial burden, especially for those who already have to contend with other costs associated with owning a property However, there are ways to reduce or even eliminate the business rates on an empty commercial property.
One way to reduce the burden of business rates on an empty property is to apply for empty property rate relief This relief is available for a limited period of time, usually three or six months, depending on the location of the property It can reduce the amount of business rates payable on an empty property by up to 100% To qualify for empty property rate relief, the property must have been empty for a certain period of time, usually three months or more.
Another way to reduce business rates on an empty commercial property is to apply for a temporary exemption This exemption can be granted for certain types of properties, such as buildings undergoing renovation or redevelopment business rates on empty commercial property. The exemption can last for up to 12 months, during which time no business rates are payable on the property This can provide much-needed financial relief for property owners who are carrying out essential works on their properties.
In some cases, property owners may be able to claim hardship relief on their business rates This relief is available for properties that are experiencing financial difficulties, such as being unable to find a tenant or facing significant repair costs Hardship relief can be granted for a limited period of time, typically one year, and can reduce the amount of business rates payable on the property.
Property owners can also take steps to reduce their business rates by appealing the rateable value of their property The rateable value is used to calculate the amount of business rates payable, so if the property owner believes that the value is too high, they can appeal to the VOA If successful, this can result in a lower rateable value and therefore lower business rates It is important to provide evidence to support the appeal, such as rental values of similar properties in the area.
It is worth noting that there are certain types of properties that are exempt from business rates altogether These include agricultural land and buildings, buildings used for public worship, and properties with a rateable value of £12,000 or less Property owners should check with their local council to see if their property qualifies for any exemptions.
In conclusion, business rates on empty commercial properties can be a significant financial burden for property owners However, by taking advantage of relief schemes, applying for exemptions, appealing rateable values, and exploring other options, property owners can mitigate these costs and potentially save money Understanding the intricacies of business rates on empty commercial properties is essential for navigating this complex area of taxation and ensuring that property owners are not overburdened with unnecessary costs.