When it comes to owning commercial property, one of the major costs that business owners need to consider is business rates. These rates are taxes that are paid on most non-domestic properties, such as shops, offices, pubs, warehouses, and factories. However, there are certain situations in which commercial property owners may be able to claim an exemption from paying business rates on empty properties. This exemption is known as the business rates empty property exemption, and it can provide significant savings for property owners. In this article, we will explore what the business rates empty property exemption is all about.
The business rates empty property exemption was introduced to provide relief for commercial property owners who are struggling to find tenants for their vacant properties. This exemption allows property owners to claim relief from paying business rates on properties that are unoccupied for a certain period of time. The length of time for which the exemption applies varies depending on the type of property and its location, but in general, the exemption period is 3 months for industrial and warehouse properties and 6 months for all other commercial properties.
It is important to note that the Business Rates Empty Property Exemption only applies to properties that are completely empty. If a property is partially occupied or being used for storage purposes, it will not be eligible for the exemption. Additionally, properties that are exempt from business rates for other reasons, such as listed buildings or agricultural land, are also not eligible for the Business Rates Empty Property Exemption.
In order to claim the exemption, property owners must notify their local council of the vacancy and provide evidence that the property is unoccupied. This usually involves submitting a form and providing details of the property, including the date it became vacant and the reason for its vacancy. Once the council has verified the vacancy, they will grant the exemption and the property owner will not be required to pay business rates for the applicable period.
While the Business Rates Empty Property Exemption can provide much-needed relief for property owners, it is important to be aware of the potential consequences of leaving a property empty for an extended period of time. Vacant properties can be vulnerable to vandalism, squatters, and deterioration due to lack of maintenance. In some cases, leaving a property empty for too long can lead to a decrease in its market value and make it harder to find tenants in the future. Property owners should weigh the potential savings from the exemption against the risks and costs associated with leaving a property empty.
There are also some restrictions on how often the Business Rates Empty Property Exemption can be claimed for the same property. In England, for example, once a property has been exempt from business rates for a total of 6 months in a 12-month period, the exemption will no longer apply. This means that property owners cannot continuously claim the exemption for the same property to avoid paying business rates indefinitely.
In addition to the Business Rates Empty Property Exemption, there are other types of relief and discounts available to commercial property owners. For example, small business rate relief is available to businesses with a rateable value below a certain threshold, and charities and community amateur sports clubs may also be eligible for relief on their business rates. Property owners should check with their local council to see if they qualify for any additional relief or discounts.
In conclusion, the Business Rates Empty Property Exemption can provide valuable savings for commercial property owners who are struggling to find tenants for their vacant properties. However, property owners should carefully weigh the potential benefits of the exemption against the risks and costs of leaving a property empty. By understanding the requirements and limitations of the exemption, property owners can make informed decisions about how to best manage their vacant properties and minimize their business rates expenses.