When it comes to owning commercial property, business rates are one of the many expenses that can impact your bottom line Business rates are taxes that businesses in the UK are required to pay on their non-residential properties These rates are based on the rateable value of the property and are collected by the local government to fund local services However, what happens when a property is left vacant? In this article, we will explore the implications of business rates on vacant property and what you need to know as a property owner.
Business rates for vacant property, also known as empty property rates, can be a costly burden for property owners In the UK, most non-residential properties are subject to business rates, including shops, offices, warehouses, and factories However, if a property is vacant, the rules surrounding business rates can become more complex.
In general, properties that are empty are still liable for business rates The government’s rationale behind this is to discourage property owners from leaving their properties vacant for extended periods of time However, there are certain exemptions and discounts available for vacant properties that can provide some relief for property owners.
One of the main exemptions for vacant property is the three-month exemption period This means that if a property becomes vacant, the owner is given a three-month grace period before they become liable for business rates During this time, the property owner is not required to pay any business rates After the three-month period expires, the property owner must start paying business rates unless they meet the criteria for one of the exemptions.
Another exemption available for vacant property is the six-month exemption for industrial properties Industrial properties that have been vacant for at least six months are eligible for a 100% exemption on their business rates for the next five years business rates vacant property. This exemption is aimed at encouraging property owners to bring these properties back into productive use.
In addition to exemptions, there are also discounts available for vacant properties For example, properties that are undergoing major repair or structural alterations may be eligible for a 100% discount on their business rates for up to 12 months This can provide significant savings for property owners who are investing in improving their vacant properties.
It is important for property owners to be aware of the rules and regulations surrounding business rates for vacant property Failure to pay business rates on a vacant property can result in costly penalties and legal action from the local government Property owners should keep detailed records of when their property became vacant and any exemptions or discounts that they are eligible for.
Property owners can also take steps to reduce their business rates liability on vacant properties For example, if a property is vacant but still has furniture or machinery inside, the rateable value of the property could be reduced Property owners can also consider leasing their vacant property to a charity or community amateur sports club, as these organizations are eligible for an 80% discount on business rates.
In conclusion, business rates for vacant property can be a complex and costly expense for property owners Understanding the rules and regulations surrounding business rates is important to avoid penalties and legal action By taking advantage of exemptions and discounts, property owners can reduce their business rates liability and potentially save money on their vacant properties Ultimately, keeping up to date with the latest regulations and seeking professional advice can help property owners navigate the complexities of business rates for vacant property.