Business rates can be a significant financial burden for property owners, especially when their property sits empty. In the United Kingdom, owners of commercial properties are required to pay business rates on their empty properties, which can add up to thousands of pounds per year. However, there are several strategies that property owners can employ to legally avoid or reduce paying these rates.
One option for property owners looking to avoid paying business rates on their empty properties is to actively market the property for sale or rent. By demonstrating that they are actively trying to find a tenant or buyer for the property, owners may be able to qualify for an exemption from business rates for a set period of time. This exemption typically lasts for three months after the property is first listed for sale or rent, and can be extended for an additional three months if the property remains vacant.
Another strategy for avoiding business rates on empty property is to apply for an exemption based on the size or condition of the property. Properties that are deemed to be too small or in poor condition may qualify for an exemption from business rates, saving the owner money while they work to bring the property up to standard. However, it is important to note that this exemption is not automatic, and owners will need to apply to their local council for consideration.
One popular tactic for avoiding business rates on empty property is to claim an exemption based on occupation by a charity or community interest group. If a charity or community organization is using the property for charitable purposes, the owner may be able to qualify for a 80% discount on their business rates. This can be a win-win situation for both the property owner and the charity, as the owner saves money on rates while the charity gains access to a property at a reduced cost.
Property owners can also take advantage of the government’s temporary exemption for newly built commercial properties. Under this scheme, owners of newly constructed properties are exempt from paying business rates for the first 18 months after the property is completed. This can provide owners with a valuable grace period to find tenants or buyers for their property without having to worry about additional financial burdens.
Owners of empty properties may also be able to avoid paying business rates by demolishing the property or converting it into a different type of use. In some cases, properties that are undergoing major renovation or conversion work may be eligible for an exemption from business rates until the work is complete. This can provide property owners with some financial relief while they work to revitalize their property and bring it back into productive use.
It is important to note that property owners who fail to pay their business rates on empty property may face enforcement action from their local council, including penalties, court costs, and even repossession of the property. Therefore, it is crucial for property owners to be proactive in seeking out exemptions and other strategies for avoiding business rates on their empty properties.
In conclusion, owning an empty property can be a financial burden for property owners, especially when business rates come into play. However, there are several strategies that property owners can use to legally avoid or reduce paying these rates, from actively marketing the property to seeking exemptions based on size, condition, or occupation by a charity. By taking advantage of these strategies, property owners can mitigate the financial impact of empty property and work towards bringing their properties back into productive use.