When it comes to owning and managing commercial property, one of the biggest concerns for landlords and property owners is the cost of business rates. These rates are taxes that businesses have to pay on the non-domestic properties they occupy, and they can be a significant financial burden, especially when the property is empty. However, there are ways to legally avoid paying business rates on empty property, and in this article, we will explore some of the options available to property owners.
First and foremost, it is important to understand the basic rules surrounding business rates on empty property. In most cases, if a commercial property is empty, the owner is still liable to pay business rates for the first three months that the property is vacant. After this initial three-month period, the property owner is entitled to an empty property rate relief, which reduces the amount of business rates that need to be paid.
One common way to avoid paying business rates on empty property is to actively market the property for rent or sale. By letting prospective tenants or buyers know that the property is available, the owner can prove to the local council that they are actively trying to find a new occupant for the property. This can help qualify the property for an extended period of empty property rate relief, which can last for up to another three months.
Another option for avoiding business rates on empty property is to apply for an exemption. Certain types of properties may be exempt from paying business rates even when they are empty. For example, buildings that are used for charitable purposes or properties that are listed as being of historical or architectural interest may not have to pay business rates when they are vacant. Property owners should check with their local council to see if their property qualifies for any exemptions.
Some property owners choose to temporarily occupy their empty properties in order to avoid paying business rates. By using the property for storage or staging purposes, the owner can demonstrate to the local council that the property is not truly vacant and should not be subject to business rates. However, it is important to note that this strategy may only work for a limited time, as the council may investigate whether the property is being genuinely used and may require proof of occupancy.
In some cases, property owners may choose to demolish or refurbish their empty properties in order to avoid paying business rates. By making significant changes to the property, such as knocking it down and rebuilding it or converting it into a different type of property, the owner may be able to apply for a temporary exemption from business rates. However, it is important to note that these types of projects can be costly and time-consuming, so property owners should carefully weigh the pros and cons before pursuing this option.
One final option for avoiding business rates on empty property is to appeal the rateable value of the property. If the owner believes that the rateable value assigned to their property is too high, they can submit an appeal to the Valuation Office Agency (VOA) and request a reassessment. If the VOA agrees that the rateable value should be lower, the owner may be entitled to a refund on the excess business rates that have already been paid.
In conclusion, there are several ways for property owners to legally avoid paying business rates on empty property. By actively marketing the property, applying for exemptions, temporarily occupying the property, demolishing or refurbishing the property, or appealing the rateable value, owners can potentially reduce their financial burden and make the most out of their vacant properties. It is important for property owners to carefully consider their options and consult with a professional advisor before taking any action.