To find yourself liable for business rates on empty property or on a space that is partially empty, can cause landlords and tenants a real problem. We offer proactive advice to minimise your business rates liability on empty and partially vacant properties.
Business rates are one of the largest financial liabilities for a business and can be an extraordinary burden when a property is vacant and there is no income. In England, empty properties are subject to full business rates after an initial three-month relief period. Normally, it’s the tenants who are responsible for paying business rates on a commercial property but if the property becomes vacant, the responsibility shifts to the landlord.
Business Rates and Empty Properties
Landlords of empty properties are exempt from business rates for the first three months after it becomes empty, but will find themselves required to pay business rates after that initial period. Some properties can get extended empty property relief, for example industrial and warehouse properties benefit from six months relief. For landlords and owners, having an empty property means no incoming rent plus the additional costs of often hefty business rates bills.
If your property remains vacant and empty property rates relief no longer applies, we offer a fully compliant solution which can mitigate your liability until such time as your property is re-occupied. Furthermore, if your property is partially occupied, in some circumstances we can apply to the local billing authority on your behalf to award temporary relief for the part not in use.
There are certain properties, whether occupied or not, that are completely exempt from business rates. This means that if your empty property is within one of these categories, then you don’t have pay business rates.
- Land that is used for agricultural purposes including fish farms
- Church halls and buildings that are registered for religious purposes
- Buildings that are meant for the welfare of disabled people
It is, however, important to note that these exemptions only apply to properties in England. Exemptions in Wales and Scotland apply differently.
Vacant Retail Unit
Acting on behalf of a local investor who had recently acquired a prominent three storey retail unit as a potential development opportunity. The property was to remain vacant whilst the owner occupier considered their plans for the building, during which time they were paying 100% of the business rates liability.
When a property first becomes vacant there is an initial three month period of rates relief (six months for industrial premises), after which the occupier will be liable for full business rates. This can be a substantial burden.
We were able to advise on a strategy to mitigate our client’s liability whilst the property remained vacant and secured three months Empty Property Rates Relief.
We successfully agreed a period of three months Empty Property Rates Relief resulting in a total of £7,300 in business rates savings over three months.
The Team for Business Rates & Empty Property
Case studies for Business Rates & Empty Property
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Some interesting updates in our business rates newsletter Click here for more information – Business Rates Newsletter Spring 2019
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