If you are a business owner or property investor, you may already be familiar with the concept of business rates However, when it comes to unoccupied property, the rules surrounding business rates can be a bit more complicated In this article, we will delve into the world of business rates on unoccupied properties and explore the various factors that come into play.
First and foremost, let’s define what exactly business rates are Business rates are a tax that is paid on non-domestic properties, such as shops, offices, factories, warehouses, and other commercial properties The amount of business rates that are due is calculated based on the rateable value of the property, which is determined by the Valuation Office Agency (VOA).
When a property is unoccupied, business rates can still be charged This can come as a surprise to many property owners, especially if they were not aware of this prior to purchasing the property However, there are certain exemptions and reliefs available for unoccupied properties that may help reduce the overall cost of business rates.
One of the most common exemptions for unoccupied properties is the three-month empty property exemption This means that if a property has been unoccupied for less than three months, no business rates will be due for that period However, after the three-month period has elapsed, business rates will be charged at the full rate.
Another exemption that may apply to unoccupied properties is the six-month empty property exemption for industrial properties This means that if an industrial property has been unoccupied for six months or more, a 100% relief on business rates may be granted business rates unoccupied property. This can provide significant savings for property owners who find themselves with vacant industrial properties.
It is important to note that in some cases, local authorities may offer additional discretionary reliefs for unoccupied properties These reliefs are typically granted on a case-by-case basis and can vary depending on the circumstances of the property Property owners should check with their local council to see if any additional reliefs are available to them.
In addition to exemptions and reliefs, property owners may also be eligible for small business rate relief on unoccupied properties This relief is available to businesses with a rateable value below a certain threshold and can provide a substantial discount on business rates It is worth exploring whether your property qualifies for this relief, as it can lead to significant savings.
For property investors who are considering purchasing unoccupied properties, it is important to factor in the cost of business rates when calculating potential returns A property that remains unoccupied for an extended period can quickly become a financial burden if business rates are not taken into account By understanding the rules and regulations surrounding business rates on unoccupied properties, investors can make more informed decisions and avoid any unexpected costs.
In conclusion, the impact of business rates on unoccupied properties can be significant Property owners must be aware of the rules and regulations surrounding business rates to ensure that they are not caught off guard by unexpected charges By exploring exemptions, reliefs, and other potential savings, property owners can minimize the financial impact of unoccupied properties and make more informed decisions about their investments.