Business rates for unoccupied property, commonly known as empty property rates, can be a significant financial burden for property owners These rates are a tax levied on non-domestic properties in the UK that are empty The government uses business rates as a way to fund local services, and the rates are charged based on the rateable value of the property.
Many property owners are unaware of the implications of leaving their property unoccupied, especially when it comes to business rates In this article, we will explore the concept of business rates for unoccupied property and provide some guidance on how property owners can manage this financial obligation.
The Rateable Value
The rateable value of a property is set by the Valuation Office Agency (VOA) in England and Wales, and the Scottish Assessors in Scotland It is an estimate of the property’s open market rental value on a certain date This figure is used to calculate the business rates that are due on the property.
For unoccupied properties, the rateable value remains the same, and the property owner is still liable to pay business rates This can be a significant financial burden, especially for property owners who are struggling to find tenants or are in the process of refurbishing their property.
Empty property rates
The government offers some relief to property owners with unoccupied properties through empty property rates In England and Wales, most non-domestic properties are subject to empty property rates of 100% of the normal charge after they have been empty for three months In Scotland, this period is six months.
There are some exceptions to this rule, such as properties with a rateable value under a certain threshold, listed buildings, and properties owned by charities or community amateur sports clubs These properties may be eligible for exemptions or discounts on their empty property rates.
Managing empty property rates
Property owners have several options when it comes to managing their empty property rates business rates unoccupied property. One option is to actively market the property to find a new tenant as quickly as possible Once a new tenant is found, the property will no longer be eligible for empty property rates, and the business rates will be payable by the tenant.
Another option is to apply for an exemption or a discount on the empty property rates Property owners should check with their local council to see if they qualify for any relief schemes In some cases, properties that are in the process of being renovated or redeveloped may be eligible for a temporary exemption.
Property owners should also be aware of the penalties for non-payment of business rates Failure to pay the rates can result in legal action being taken against the property owner, including court proceedings and the seizure of assets It is important to stay on top of business rates payments to avoid these consequences.
Conclusion
Business rates for unoccupied property can be a significant financial burden for property owners, especially when the property remains empty for an extended period It is important for property owners to understand the implications of leaving their property unoccupied and to take proactive steps to manage their empty property rates.
By actively marketing the property, applying for exemptions or discounts, and staying on top of payments, property owners can minimize the financial impact of empty property rates It is also important to stay informed about any changes to the regulations surrounding business rates for unoccupied property to ensure compliance with the law.