Business rates can be a significant expense for property owners, particularly when a property sits empty. In the UK, empty properties are still subject to business rates, which can add up to thousands of pounds in costs each year. However, there are strategies that property owners can use to minimize or even avoid paying business rates on empty property. In this article, we will explore some of the options available to property owners looking to reduce their business rates liability.
One of the most common ways to avoid paying business rates on empty property is to apply for an exemption. In England, for example, properties are exempt from business rates for the first three months after they become empty. This means that property owners have a three-month window to find a new tenant or buyer before they are required to start paying business rates. However, if the property remains empty after the three-month exemption period, business rates will be due.
Property owners can also apply for an extended exemption if they can demonstrate that the property is undergoing significant repair or structural work that prevents it from being occupied. In some cases, this exemption can last for up to 12 months, giving property owners more time to bring the property back into use without incurring business rates costs.
Another option for avoiding business rates on empty property is to claim an exemption if the property is deemed to be of a low rateable value. In England, for example, properties with a rateable value of £2,600 or less are exempt from business rates, regardless of whether they are occupied or empty. This can provide significant savings for property owners with smaller or less valuable properties.
Property owners may also be able to reduce their business rates liability by applying for hardship relief. This option is available to property owners who can demonstrate that paying business rates on an empty property would cause them significant financial hardship. Local authorities have the discretion to grant hardship relief on a case-by-case basis, so property owners should be prepared to provide evidence of their financial situation in order to qualify for this relief.
In some cases, property owners may be able to reduce their business rates liability by taking advantage of transitional relief. This relief is designed to help property owners adjust to changes in the rateable value of their property, such as after a revaluation. By phasing in increases to their business rates liability over a period of time, property owners can avoid sudden and significant jumps in their rates bill.
Property owners may also be able to avoid paying business rates on empty property by taking advantage of the various discounts and reliefs available to certain types of properties. For example, charities and community amateur sports clubs are entitled to an 80% discount on their business rates bill for properties that they use for charitable purposes. Similarly, properties that are used for certain purposes, such as agriculture or storage, may be eligible for relief or discounts on their business rates liability.
Finally, property owners can explore the option of appealing their business rates assessment in order to lower their rates bill. This can be a complex and time-consuming process, but property owners who believe that their rates bill is too high may be able to achieve a reduction by providing evidence to support a lower rateable value for their property. Working with a professional surveyor or tax advisor can help property owners navigate the appeals process and improve their chances of success.
In conclusion, there are several strategies that property owners can use to reduce or avoid paying business rates on empty property. By taking advantage of exemptions, reliefs, discounts, and appeals, property owners can minimize their rates liability and save money on their property costs. It is important for property owners to be proactive in exploring these options and seeking professional advice where necessary in order to make the most of the opportunities available to them.