Empty business properties can be a headache for property owners and businesses alike. Not only are they a financial burden due to lack of income, but they also often incur unoccupied business rates. These rates can add up quickly, leaving property owners with an added expense that they may not have accounted for. In this article, we will explore what unoccupied business rates are, how they are calculated, and what options are available to property owners facing these charges.
unoccupied business rates, also known as empty property rates, are taxes that businesses must pay on properties that are vacant. These rates were introduced as a way to discourage property owners from leaving their properties empty for extended periods of time. The idea behind these rates is to incentivize property owners to either occupy or rent out their properties, rather than letting them sit empty.
Calculating unoccupied business rates can be a complex process, as they are based on the rateable value of the property. The rateable value is the value of the property as determined by the government’s Valuation Office Agency. The rates themselves are set by the government and can vary depending on the location of the property. In England, for example, unoccupied business rates are usually charged at 3/4 of the full business rates after the property has been empty for three months.
Property owners are required to pay unoccupied business rates on properties that have been empty for more than three months. This can be a substantial cost for property owners, especially if they have multiple vacant properties. In some cases, property owners may be able to get a discount on their unoccupied business rates if they can prove that they are actively trying to find a tenant for the property.
There are some exemptions to unoccupied business rates that property owners should be aware of. For example, newly built properties are exempt from unoccupied business rates for the first three months after they are completed. Industrial properties are also exempt from unoccupied business rates for the first six months after they become empty. It is important for property owners to be aware of these exemptions and to take advantage of them if possible.
If property owners are struggling to pay their unoccupied business rates, there are some options available to help alleviate the financial burden. One option is to apply for a hardship relief scheme, which can provide property owners with a discount on their rates if they can prove that paying the full amount would cause them financial hardship. Another option is to negotiate with the local council to come up with a payment plan that works for both parties.
Property owners can also take steps to avoid unoccupied business rates altogether. One option is to lease out the property on a short-term basis to avoid being subject to the rates. Another option is to use the property for storage or other non-business purposes, as these activities are not subject to unoccupied business rates.
In conclusion, unoccupied business rates can be a costly expense for property owners, but there are options available to help alleviate the financial burden. By understanding what unoccupied business rates are, how they are calculated, and what exemptions are available, property owners can take steps to minimize the impact of these rates on their finances. Whether it is seeking hardship relief, negotiating with the local council, or finding alternative uses for the property, there are ways to mitigate the cost of unoccupied business rates and protect the bottom line.