When it comes to owning vacant property, there are many factors that property owners must consider One such consideration is the impact of business rates on vacant property Business rates, also known as non-domestic rates, are taxes that businesses in the UK must pay to their local council These rates are based on the rateable value of the property and are used to fund local services such as education, roads, and social care.
Vacant properties are not exempt from business rates, and property owners may still be required to pay these rates even if their property is empty This can be a significant financial burden for property owners, especially if they are unable to find tenants for their property In this article, we will explore the implications of business rates on vacant property and provide some tips on how property owners can mitigate these costs.
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 is reviewed every five years If a property is vacant for an extended period, the rateable value may be reassessed by the VOA, potentially increasing the amount of business rates owed by the property owner.
In most cases, vacant properties are eligible for a 100% discount on business rates for the first three months that the property is empty After this initial period, property owners must pay the full amount of business rates unless they are eligible for additional exemptions or relief This can add up to a significant expense for property owners, especially if their property remains vacant for an extended period.
One way that property owners can reduce the impact of business rates on vacant property is by applying for Empty Property Relief Empty Property Relief is a discretionary relief that is offered by local councils to reduce the amount of business rates owed on vacant properties business rates vacant property. Each council sets its own criteria for Empty Property Relief, so property owners should contact their local council to determine if they are eligible for this relief.
Another option for property owners is to consider temporary uses for their vacant property By temporarily renting out their property for events, pop-up shops, or other short-term uses, property owners can generate income that can help offset the cost of business rates Additionally, temporary uses can help to attract potential tenants by showcasing the potential of the property and increasing its visibility in the market.
Property owners can also consider negotiating with their local council to reduce the amount of business rates owed on their vacant property While councils are not required to grant reductions in business rates, they may be willing to negotiate a lower rate if the property has been vacant for an extended period or if the property owner can demonstrate financial hardship It is important for property owners to provide documentation and evidence to support their request for a rate reduction.
In some cases, property owners may be able to apply for Mandatory Relief on their vacant property Mandatory Relief is available for certain types of property, such as industrial or warehouse properties, that have been vacant for a specific period Property owners should check with their local council to determine if their property is eligible for Mandatory Relief and to apply for this relief if applicable.
Overall, business rates on vacant property can be a significant financial burden for property owners By exploring options such as Empty Property Relief, temporary uses, negotiation with the local council, and Mandatory Relief, property owners can mitigate the impact of business rates on their vacant property It is important for property owners to stay informed about their options and to seek advice from professionals such as tax advisors and property agents to ensure that they are taking full advantage of available relief opportunities.