Commercial property owners are often faced with the burden of paying rates on properties that are sitting empty. These rates, known as empty property rates, can add up to a significant cost for owners who are struggling to find tenants or are going through a period of vacancy. Understanding how these rates are calculated and any exemptions that may apply can help property owners mitigate the financial impact of empty property rates.
Empty property rates, also known as non-domestic rates, are taxes that are payable on commercial properties that are unoccupied for an extended period of time. In the United Kingdom, empty property rates were introduced in 2008 as a measure to encourage property owners to bring vacant properties back into use and prevent the epidemic of derelict, abandoned buildings blighting local communities.
The rates that are payable on empty commercial property are calculated based on the rateable value of the property. The rateable value is assessed by the Valuation Office Agency and represents the rental value of the property as of a specific date. For properties that have been empty for more than three months, the empty property rates are usually set at the same rate as the standard business rates, which can be a significant financial burden for property owners.
There are, however, some exemptions and reliefs available to property owners who find themselves liable for empty property rates. One of the most common exemptions is the 100% empty property rate relief, which applies to properties that have been empty for a specified period of time. This relief can provide some temporary respite for property owners who are struggling to find tenants or are undergoing renovations or refurbishments.
In addition to the 100% empty property rate relief, there are also other types of relief available that can help reduce the financial burden of empty property rates. For example, small business rate relief may be available to businesses that operate from a single property with a rateable value below a certain threshold. This relief can provide a significant reduction in the amount of rates payable on empty commercial property.
It is important for property owners to be aware of the various exemptions and reliefs that are available to them when it comes to empty property rates. By taking advantage of these schemes, property owners can reduce the financial impact of empty property rates and make it easier to manage the costs associated with owning and maintaining commercial property.
In some cases, property owners may also be able to reduce their liability for empty property rates by actively marketing the property for rent or sale. By demonstrating that efforts are being made to bring the property back into use, property owners may be able to qualify for a temporary exemption from empty property rates. This can provide a valuable incentive for property owners to take proactive steps to fill their vacant properties and avoid hefty empty property rates.
Overall, rates payable on empty commercial property can be a significant financial burden for property owners. However, by understanding how these rates are calculated and taking advantage of any exemptions and reliefs that may apply, property owners can mitigate the impact of empty property rates and make it easier to manage the costs associated with owning vacant commercial property.
In conclusion, empty property rates are an unavoidable cost for many commercial property owners. By understanding how these rates are calculated and being aware of the exemptions and reliefs that are available, property owners can reduce the financial impact of empty property rates and make it easier to manage the costs associated with owning vacant commercial property. It is important for property owners to be proactive in seeking out relief and taking steps to bring their properties back into use in order to avoid the burden of empty property rates.