Business rates can be a significant financial burden for property owners, especially when the property is empty and not generating any income In the UK, business rates are charged on most non-domestic properties, including commercial premises, industrial buildings, and even empty properties However, there are ways to avoid paying business rates on empty property, and in this article, we will explore some of the ways property owners can minimize their financial liabilities.
One of the easiest ways to avoid paying business rates on empty property is by taking advantage of the empty property relief scheme This scheme provides a temporary exemption from business rates for properties that are unoccupied for a certain period of time In England, for example, commercial properties are eligible for a 100% exemption from business rates for the first three months that they remain vacant After the initial three-month period, the exemption is reduced to 50% for a further three months, and then the full rate is payable.
To qualify for empty property relief, property owners must ensure that their property remains unoccupied and unfurnished This means that even if a property is being used for storage or kept in a state of disrepair, it may still be eligible for the relief scheme However, it is essential to keep in mind that once the property is occupied or the use of the property changes, the relief will no longer apply, and business rates will be due.
Another way to avoid business rates on empty property is by considering demolition or renovation Some properties may be eligible for exemptions or reductions in business rates if they are uninhabitable or in need of significant repair By demolishing or renovating the property to bring it up to a habitable standard, property owners may be able to claim a reduction in business rates under the improvement relief scheme.
It is also worth exploring whether the property qualifies for small business rate relief avoiding business rates on empty property. In some cases, small business properties with a rateable value below a certain threshold may be eligible for a discount in their business rates By qualifying for small business rate relief, property owners can significantly reduce their financial liabilities and make it more manageable to cover the costs of an empty property.
For those property owners who are unable to benefit from any of the above schemes, there are still other options to consider For example, some landlords may choose to lease their property to a charity or community organization to take advantage of the mandatory relief scheme Properties occupied by registered charities are eligible for an 80% reduction in business rates, which can be a cost-effective solution for property owners struggling to cover the expenses of an empty property.
Alternatively, property owners may consider letting their property on a short-term basis to avoid paying business rates on an empty property By entering into a short-term lease agreement with a tenant, property owners can transfer the liability for business rates to the tenant while generating some income from the property This can be a practical solution for property owners who are unable to secure a long-term tenant but still wish to avoid paying the full rate of business rates on an empty property.
In conclusion, there are several ways for property owners to avoid paying business rates on empty property From taking advantage of empty property relief schemes to exploring other avenues such as renovation, small business rate relief, or short-term leasing, property owners have options to minimize their financial liabilities and make it more manageable to own an empty property By understanding the available options and seeking professional advice, property owners can make informed decisions to reduce the financial burden of business rates on empty property.