Business rates on empty properties can be a substantial financial burden for property owners. In some cases, these rates can add up to thousands of pounds per year, making it even more difficult to earn a return on investment. However, there are several strategies that property owners can employ to legally minimize or avoid business rates on empty property. By being proactive and implementing these tactics, property owners can save a significant amount of money and protect their bottom line.
One of the most common and effective strategies for avoiding business rates on empty property is to claim exemption. In the UK, most empty properties are subject to business rates after a 3-month exemption period. However, there are certain exemptions available that property owners can take advantage of to avoid paying these rates. For example, if a property is temporarily exempt due to being in an area undergoing redevelopment or if it is classified as a listed building, the owner may be able to claim exemption from business rates. It is important to carefully review the criteria for these exemptions and ensure that all necessary paperwork is submitted to the local government authority in a timely manner.
Another strategy to consider is to challenge the rateable value of the property. Business rates are calculated based on the rateable value of a property, which is determined by the Valuation Office Agency (VOA). If a property owner believes that the rateable value assigned to their property is too high, they have the right to challenge this valuation. By providing evidence to support a lower rateable value, property owners may be able to successfully reduce their business rates liability. It is recommended to seek professional advice from a chartered surveyor or rating specialist when challenging the rateable value to ensure the best possible outcome.
Property owners can also consider taking advantage of the small business rate relief scheme. This scheme provides a discount on business rates for properties with a rateable value below a certain threshold. By qualifying for this relief, property owners can significantly reduce their business rates liability or even eliminate it entirely. It is important to check the eligibility criteria for this scheme and apply for relief if the property meets the requirements.
Furthermore, property owners should consider occupying their empty property with a charitable or community organization. Properties occupied by these types of organizations are often eligible for 80% relief on business rates. By partnering with a qualifying organization, property owners can minimize their business rates liability while also supporting a good cause. It is important to ensure that the organization meets the criteria for relief and that all necessary paperwork is submitted to the local government authority.
In some cases, property owners may be able to qualify for hardship relief. This relief is available to property owners who are experiencing financial hardship due to their business rates liability. By demonstrating financial difficulty and inability to pay the full rates, property owners can apply for a temporary reduction or exemption from business rates. It is important to provide evidence of financial hardship and work closely with the local government authority to secure this relief.
Another strategy to consider is to explore the possibility of demolishing or repurposing the empty property. By demolishing the property or converting it into a different type of use, property owners may be able to qualify for relief or exemption from business rates. For example, properties undergoing redevelopment or change of use are often exempt from business rates for a specified period of time. Property owners should carefully consider the costs and benefits of these options before making a decision.
In conclusion, there are several strategies that property owners can employ to avoid business rates on empty property. By claiming exemption, challenging the rateable value, applying for small business rate relief, partnering with charitable organizations, seeking hardship relief, or considering demolition or repurposing, property owners can minimize their business rates liability and protect their financial interests. It is important to carefully review all options available and choose the most suitable strategy based on individual circumstances. By being proactive and taking advantage of these tactics, property owners can save money and ensure the long-term success of their investments.