When it comes to owning commercial property, one of the expenses that property owners need to consider is the rates payable on empty commercial properties These rates, also known as business rates, are a tax that commercial property owners are required to pay to the local council However, empty commercial properties may be subject to different rates compared to occupied properties In this article, we will delve into the details of rates payable on empty commercial properties and how property owners can navigate this aspect of property ownership.
Empty commercial properties are those that are not currently being used or occupied by a tenant Usually, when a commercial property is occupied by a business, the occupier is responsible for paying the business rates However, when a property becomes vacant, the liability for paying the rates shifts to the property owner.
The rules regarding rates payable on empty commercial properties can vary depending on the location and specific circumstances In England, for example, vacant commercial properties with a rateable value of less than £2,900 are exempt from paying business rates This exemption lasts for three months, after which the property owner will be required to pay 100% of the rates In Wales, the exemption period is six months for properties with a rateable value of less than £2,600.
For properties with a rateable value of over £2,900 in England and £2,600 in Wales, the rates payable on empty commercial properties can be significant The rateable value of a property is determined by the Valuation Office Agency (VOA) and is based on factors such as the size, location, and condition of the property Property owners can check the rateable value of their property on the VOA website.
In some cases, property owners may be eligible for reliefs or exemptions on the rates payable on empty commercial properties For example, properties that are undergoing major repair or structural work may qualify for a 100% exemption for up to 12 months rates payable on empty commercial property. Additionally, properties in certain designated areas may be eligible for specific relief schemes aimed at promoting the regeneration of the area.
It is important for property owners to be aware of the rules and regulations regarding rates payable on empty commercial properties to avoid any penalties or fines Failure to pay the business rates on time can result in legal action being taken by the local council, which could include court proceedings and the possibility of the property being seized to cover the outstanding debt.
Property owners should also consider the impact of rates payable on empty commercial properties when making decisions about their property investments The cost of business rates can be a significant financial burden, especially for properties that remain vacant for an extended period Property owners may need to factor in these costs when setting rental prices or making decisions about refurbishing or selling the property.
In some cases, property owners may choose to explore alternative options for their empty commercial properties to help mitigate the rates payable For example, property owners could consider leasing the property on short-term agreements to temporary tenants, such as pop-up shops or seasonal businesses This can help generate income from the property while also potentially attracting long-term tenants.
Property owners could also explore the possibility of applying for rates relief or exemptions based on the specific circumstances of their property By engaging with the local council and providing evidence of the property’s condition or the efforts being made to bring the property back into use, property owners may be able to reduce or eliminate the rates payable on their empty commercial properties.
In conclusion, rates payable on empty commercial properties are an important consideration for property owners Understanding the rules and regulations regarding business rates is crucial to avoid any financial penalties or legal consequences Property owners should explore all options available to them, including reliefs, exemptions, and alternative leasing strategies, to manage the rates payable on their empty commercial properties effectively By staying informed and proactive, property owners can navigate this aspect of property ownership successfully.