Ways To Avoid Business Rates On Empty Property

When it comes to owning property for business purposes, one of the most common expenses that many property owners face is business rates. These rates are charged on most non-domestic properties, including commercial buildings and empty properties. However, there are some strategies that property owners can implement to legally minimize or avoid business rates on empty property.

1. Temporary Exemptions

One way to avoid business rates on empty property is to take advantage of temporary exemptions. In England, Wales, and Scotland, most empty properties are exempt from paying business rates for the first three months after they become empty. This can provide property owners with a brief period of relief before they have to start paying rates again.

Additionally, in certain circumstances, property owners may be eligible for longer-term exemptions. For example, properties that are being refurbished or undergoing structural repairs may be eligible for extended exemptions. It’s important for property owners to check with their local authorities to see if their property qualifies for any exemptions.

2. Claiming Unoccupied Property Rates Relief

Another way to avoid business rates on empty property is to claim unoccupied property rates relief. In some cases, property owners may be eligible for a discount on their rates if their property has been empty for an extended period of time. The rate of relief varies depending on the local authority, so property owners should check with their council to see if they qualify for this benefit.

3. Renovating or Repurposing the Property

One of the most effective ways to avoid business rates on empty property is to renovate or repurpose the property for a different use. If the property is no longer suitable for its original purpose, property owners may be able to apply for a change in the property’s classification, which could result in lower business rates or full exemption.

For example, converting an empty office building into residential apartments could result in a significant reduction in business rates, as residential properties are typically subject to lower rates than commercial properties. Property owners should consult with their local authorities to see what options are available for reclassifying their property.

4. Subletting the Property

Another strategy for avoiding business rates on empty property is to sublet the space to another business. By subletting the property, the new tenant would become responsible for paying the business rates, thereby relieving the original property owner of this expense.

Property owners should be cautious when subletting their property, as they will still be legally responsible for ensuring that the rates are paid in full. It’s important to have a clear agreement in place with the subtenant outlining their responsibilities for paying the rates and any other associated costs.

5. Utilizing Empty Property Relief Schemes

In some areas, local authorities offer empty property relief schemes to incentivize property owners to bring their vacant properties back into use. These schemes may offer financial incentives or tax breaks to property owners who agree to refurbish or redevelop their empty properties within a specified timeframe.

Property owners should research if any empty property relief schemes are available in their area and see if they qualify for any benefits. Taking advantage of these schemes can not only help property owners avoid business rates on empty property but also contribute to the revitalization of local communities.

6. Appealing the Rateable Value

If property owners believe that the rateable value of their empty property is too high, they have the right to appeal to the Valuation Office Agency (VOA) to have it reassessed. A lower rateable value could result in reduced business rates or even qualify the property for exemption.

It’s important for property owners to provide evidence to support their appeal, such as rental value comparisons or evidence of structural damage. While the appeals process can be time-consuming, it can be worthwhile if it results in savings on business rates in the long run.

In conclusion, there are several ways for property owners to legally avoid or minimize business rates on empty property. By taking advantage of exemptions, relief schemes, and other strategies, property owners can reduce their financial burden and potentially increase the value of their properties. It’s important for property owners to stay informed about their options and work closely with their local authorities to find the best solution for their individual circumstances.