When it comes to owning commercial property, there are many factors to consider that can impact the overall success and profitability of your investment One of the key considerations for property owners is the issue of business rates for empty commercial property This is a significant cost that can have a big impact on your bottom line, and it’s important to understand the implications of these rates and how they are calculated.
Business rates are a tax that is levied on non-domestic properties in the UK, including commercial properties such as shops, offices, and industrial units The rates are charged by local authorities and are used to fund local services and infrastructure In some cases, property owners may be eligible for a discount or exemption on their rates, but when a property is empty, the rates can be a substantial financial burden.
The rates for empty commercial property are calculated based on the rateable value of the property The rateable value is determined by the Valuation Office Agency (VOA) and is based on the rental value of the property as of a specific date The rates are then calculated by applying a multiplier set by the government to the rateable value.
For properties that have been empty for a long period of time, the rates can be especially burdensome In an effort to encourage property owners to bring empty properties back into use, the government offers relief on business rates for empty commercial property This relief is intended to provide financial support to property owners while also helping to stimulate economic activity and reduce blight in communities.
There are different schemes available for business rates relief on empty commercial property, including:
1 Empty property relief: This relief provides a 100% exemption on business rates for the first three months that a property is empty After this initial period, the property owner may be eligible for a further 100% exemption for a further three months if the property is an industrial property, or a further six months if the property is listed.
2 Retail relief: This relief provides a 100% exemption on business rates for occupied retail properties with a rateable value of less than £51,000 business rates empty commercial property. The relief is intended to support small businesses and encourage the use of retail properties in town centers.
3 Charitable relief: Registered charities are eligible for an 80% discount on their business rates This relief applies to properties that are mainly used for charitable purposes.
It’s important for property owners to be aware of these relief schemes and to take advantage of them where possible By reducing the financial burden of business rates on empty commercial property, property owners can free up resources to invest in the upkeep and improvement of their properties, making them more attractive to potential tenants.
In addition to relief schemes, property owners can also take steps to mitigate the impact of business rates on empty commercial property For example, property owners can negotiate with their local authority to agree to a payment plan for the rates, spreading out the cost over a longer period of time Property owners can also petition their local authority for a reduction in the rateable value of their property if they believe it has been overvalued by the VOA.
Ultimately, the issue of business rates on empty commercial property is a complex one that requires careful consideration and planning Property owners must be aware of the relief schemes available to them and take proactive steps to minimize the financial impact of these rates on their properties By doing so, property owners can ensure that their investments remain viable and profitable in the long term.
In conclusion, business rates on empty commercial property can be a significant financial burden for property owners However, by understanding the relief schemes available and taking proactive steps to mitigate the impact of these rates, property owners can ensure that their investments remain profitable and sustainable It’s important for property owners to be aware of their options and to seek professional advice if they are unsure about how to proceed With careful planning and management, property owners can navigate the issue of business rates on empty commercial property successfully and protect their investments for the future.