Business rates can be a significant financial burden for property owners, especially when their premises are sitting empty. Fortunately, there are ways to legally avoid paying business rates on empty property. Understanding the regulations and implementing the necessary steps can help property owners save money and make their investments more profitable. In this article, we will explore some strategies for avoiding business rates on empty property.
First and foremost, it is essential to understand the regulations regarding business rates on empty property. In the United Kingdom, commercial properties are subject to business rates, which are calculated based on the rateable value of the property. However, there are exemptions and reliefs available for empty properties under certain circumstances.
One of the most common ways to avoid paying business rates on empty property is by claiming an exemption. Properties that are empty and rateable for a short period may qualify for a 100% exemption from business rates. In England, properties are exempt from business rates for the first three months after they become empty. After this initial three-month period, most properties are subject to a 50% discount on their business rates for the next three months. Some properties, such as industrial premises, may be entitled to longer periods of exemption.
Another way to avoid paying business rates on empty property is by applying for a statutory exemption. Certain types of properties are automatically exempt from business rates when they are empty, such as buildings with a rateable value of less than £2,900. Additionally, properties that are undergoing major structural repairs or undergoing a change in use may be exempt from business rates for a specified period.
Property owners can also seek relief from business rates on empty property by taking advantage of the Government’s Empty Property Relief scheme. Under this scheme, properties that have been empty for more than three months may be eligible for a discount on their business rates. The discount can range from 10% to 100%, depending on the type of property and the local authority’s discretion.
In some cases, property owners may be able to avoid paying business rates on empty property by actively marketing it for rent or sale. If the property is actively being marketed and efforts are being made to find a tenant or buyer, the local authority may grant a temporary exemption from business rates. Property owners must provide evidence of their marketing efforts, such as advertising in local newspapers or on property listing websites, to qualify for this exemption.
Property owners can also consider leasing their empty property to a charity or community organization to avoid paying business rates. Properties that are occupied by a registered charity or used for charitable purposes may be eligible for a 80% discount on their business rates. By leasing their empty property to a charity, property owners can support a good cause while reducing their financial burden.
It is important for property owners to keep detailed records of any exemptions or reliefs they claim for their empty property. They should maintain documentation of the property’s vacancy period, any repairs or renovations being conducted, and their marketing efforts to find a tenant or buyer. By staying organized and proactive, property owners can ensure they are taking advantage of all available options for avoiding business rates on empty property.
In conclusion, there are several strategies that property owners can use to avoid paying business rates on empty property. By understanding the regulations, claiming exemptions, seeking relief, actively marketing the property, or leasing it to a charity, property owners can reduce their financial burden and make their investments more profitable. With careful planning and attention to detail, property owners can successfully navigate the complexities of business rates on empty property and save money in the process.