Business rates on unoccupied property can often be a headache for property owners and commercial landlords With many business owners struggling to keep their businesses afloat during these challenging times, the burden of paying business rates on a property that is sitting empty can add further financial strain In this article, we will delve into the world of business rates for unoccupied property, exploring what they are, how they are calculated, and what property owners can do to minimize the impact.
Business rates are taxes that are charged on most non-domestic properties, including shops, offices, warehouses, and factories They are based on the rateable value of the property, which is determined by the Valuation Office Agency (VOA) The rateable value is an estimate of the annual rent that the property could achieve on the open market, assuming that it was in a state of reasonable repair and decoration Business rates are a significant source of revenue for local authorities, and they help to fund essential services such as schools, roads, and waste management.
When a property becomes unoccupied, the responsibility for paying the business rates falls on the property owner This can be a significant financial burden, especially if the property has been on the market for an extended period without attracting any tenants In some cases, property owners may be eligible for an exemption from paying business rates on unoccupied property This exemption typically lasts for three months for commercial properties and six months for industrial properties After this initial exemption period, the property owner will be required to pay the full business rates unless they qualify for further relief.
There are several ways in which property owners can reduce the amount of business rates they are required to pay on unoccupied property One option is to apply for an Empty Property Relief, which provides a 100% exemption from business rates for the first three months that a property is unoccupied and unfurnished business rates unoccupied property. After this period, the exemption is reduced to 50% for commercial properties and 100% for industrial properties Property owners can also apply for hardship relief if they are experiencing financial difficulties and are struggling to pay the business rates on unoccupied property.
Another option for property owners who are struggling to pay the business rates on unoccupied property is to consider leasing the property to a charity or community interest company Properties that are occupied by charities or community interest companies are eligible for a 80% discount on the business rates, which can help to reduce the financial burden on the property owner This can be a win-win situation for both parties, as the charity or community interest company benefits from a discounted rate on the property, while the property owner receives relief from paying the full business rates.
It is important for property owners to be aware of their obligations when it comes to business rates on unoccupied property Failure to pay the business rates can result in legal action being taken against the property owner, including the possibility of prosecution and fines Property owners should ensure that they are up to date with the latest regulations and guidance on business rates for unoccupied property, and seek professional advice if they are unsure about their obligations.
In conclusion, business rates on unoccupied property can be a significant financial burden for property owners and commercial landlords However, there are ways in which property owners can reduce the amount of business rates they are required to pay, such as applying for Empty Property Relief, leasing the property to a charity or community interest company, or seeking hardship relief It is important for property owners to be aware of their obligations and seek professional advice if they are unsure about their responsibilities By taking proactive steps to minimize the impact of business rates on unoccupied property, property owners can ease the financial strain and focus on finding a suitable tenant for their property.