Vacant properties can be a source of frustration for property owners, especially when it comes to business rates. Business rates are taxes that are levied on non-residential properties, such as shops, offices, and warehouses. These rates are based on the rateable value of the property, which is determined by the Valuation Office Agency.
When a property is vacant, it can still be liable for business rates. This can come as a shock to property owners who may not be aware of this requirement. However, understanding the rules around business rates on vacant property can help owners avoid any unexpected costs and plan accordingly.
One important thing to note is that businesses are generally not required to pay business rates on a property for the first three months after it becomes vacant. This is known as the empty property relief period. After this initial period, the property owner will usually be liable for 50% of the normal business rates for the next three months. After six months of the property being vacant, the full business rates will be due.
There are some exceptions to these rules. For example, certain types of property are exempt from business rates altogether, such as agricultural land and buildings, fish farms, and buildings used for training or welfare purposes. Additionally, some properties may be eligible for other types of relief, such as charitable rate relief or small business rate relief.
It’s also worth noting that the rules around business rates on vacant property can vary depending on the location of the property. Different local authorities may have their own policies when it comes to business rates, so it’s important to check with the relevant authority to find out what the specific rules are for a particular property.
One option for property owners who are struggling to pay business rates on a vacant property is to apply for empty property relief. This relief is available for certain types of properties, such as industrial properties that are likely to become occupied in the future. Property owners can apply for empty property relief by contacting their local council and providing evidence that the property is actively being marketed for rent or sale.
Another option for property owners is to consider renting out the property on a short-term basis in order to avoid paying the full business rates. This can help to generate some income while the property is vacant and may also attract potential long-term tenants who are looking to lease the property.
Property owners should also be aware that leaving a property vacant for an extended period of time can have implications for the value of the property. Vacant properties can quickly fall into disrepair and become targets for vandalism and squatting. This can not only reduce the value of the property, but also make it more difficult to find a tenant in the future.
In some cases, property owners may decide to demolish a vacant property in order to avoid paying business rates on it. However, it’s important to note that even if a property is demolished, the land itself may still be liable for business rates. Property owners should check with their local council to find out what the rules are in their area.
Overall, understanding the rules around business rates on vacant property is essential for property owners who want to avoid any unexpected costs and make the most of their investment. By staying informed and exploring all available options for relief, property owners can ensure that they are not caught off guard by business rates on their vacant property.