Business rates can be a significant financial burden for property owners, especially when a property sits empty and generates no income. In some cases, property owners may find themselves paying thousands of pounds in business rates for an empty property, adding to their financial strain. However, there are ways to avoid paying business rates on empty property legally. In this article, we will explore some strategies that property owners can use to effectively reduce or eliminate business rates on their empty properties.
**Understanding Business Rates**
Business rates are taxes that property owners in the UK are required to pay to their local authorities. These rates are based on the rental value of a property and are used to fund local services such as schools, roads, and waste collection. However, when a property is empty, the property owner may be eligible for a discount or exemption from paying business rates.
**Qualifying for Empty Property Relief**
One way to avoid paying business rates on an empty property is to apply for Empty Property Relief. This relief allows property owners to receive a 100% discount on their business rates for a certain period, typically three or six months, depending on the local authority. To qualify for Empty Property Relief, the property must be completely empty and not used for any business purposes.
**Making Use of Exemptions**
In certain circumstances, property owners may be eligible for exemptions that can help reduce or eliminate their business rates on empty property. For example, newly built properties are exempt from business rates for the first three months after completion. Additionally, properties that are undergoing major repair or structural alterations may be eligible for a temporary exemption from business rates.
**Considering Listed Buildings**
Listed buildings are properties that are of special architectural or historic interest and are protected by law. Property owners of listed buildings may be eligible for a discount on their business rates, even if the property is empty. This discount is intended to help offset the cost of maintaining and preserving the historic property.
**Using Property Guardians**
Another strategy that property owners can use to avoid paying business rates on empty property is to hire property guardians to occupy the property temporarily. Property guardians are individuals or companies that provide temporary security for vacant properties by occupying them on a short-term basis. By having property guardians in place, property owners can potentially qualify for a discount on their business rates or even be exempt from paying them altogether.
**Exploring Change of Use**
Property owners may also consider exploring alternative uses for their empty properties to avoid paying business rates. For example, converting an empty office building into residential units may qualify for a change of use exemption, which can help reduce business rates. It is important to check with the local authority to ensure that any proposed change of use complies with planning regulations and is eligible for business rates relief.
**Seeking Professional Advice**
Navigating the complex world of business rates can be challenging, especially for property owners with multiple properties. Seeking professional advice from a surveyor or tax advisor can help property owners understand their options for reducing or eliminating business rates on empty property. These professionals can provide valuable insights and guidance on the best strategies to minimize the financial impact of business rates on empty properties.
**Conclusion**
Business rates on empty property can be a significant financial burden for property owners, but there are strategies that can be used to avoid or reduce these costs. By taking advantage of Empty Property Relief, exemptions, property guardians, change of use, and seeking professional advice, property owners can effectively manage their business rates and alleviate some of the financial strain associated with empty properties. With careful planning and proactive measures, property owners can navigate the world of business rates and make informed decisions to protect their financial interests.
In conclusion, avoiding business rates on empty property is possible with the right knowledge and strategies in place. By exploring the options mentioned above, property owners can effectively minimize their financial burden and maximize the value of their empty properties.