When owning a property that is currently vacant, one of the major concerns for business owners is the liability for business rates. Business rates are taxes that businesses have to pay on non-domestic properties, including commercial properties that are empty. However, there are strategies that business owners can use to potentially avoid or reduce business rates on empty property.
One of the first things business owners can do to avoid business rates on empty property is to check if their property is eligible for exemptions. In some cases, certain types of properties are exempt from paying business rates even if they are vacant. For example, properties with a rateable value below a certain threshold or properties owned by charities or community amateur sports clubs may be exempt from business rates. It is important to check with the local council to see if the property qualifies for any exemptions.
Another way to avoid business rates on empty property is to consider temporary occupation. By allowing a temporary occupation of the property, such as renting it out for short-term use or hosting events on the premises, business owners may be able to qualify for empty property relief. According to the government guidelines, as long as the property is temporarily occupied for at least 42 days, the owners may be eligible for a six-month exemption from paying business rates. This can be a viable option for business owners who are looking to reduce their business rates liability while still maintaining control over their property.
Additionally, business owners can consider demolishing or refurbishing the property to avoid business rates on empty property. Properties that are undergoing major redevelopment or refurbishment works are often eligible for exemptions from paying business rates. By submitting a completion notice to the local council and providing evidence of the ongoing works, business owners can potentially reduce their business rates liability while improving the property for future use. However, it is important to note that the property must be actively undergoing works in order to qualify for this exemption.
Business owners can also explore the option of negotiating with the local council for a discretionary rate relief. In some cases, councils may be willing to grant a reduction or exemption from business rates based on individual circumstances. By providing evidence of financial hardship or demonstrating efforts to market the property for rent or sale, business owners may be able to negotiate a lower rate or exemption from business rates. It is recommended to reach out to the local council to discuss potential options for discretionary rate relief for empty property.
While there are strategies to avoid business rates on empty property, it is important for business owners to be aware of the consequences of non-payment. Failure to pay business rates on empty property can result in legal action by the local council, including court proceedings and enforcement action. This can lead to additional costs and penalties for the business owner, as well as potential damage to their credit rating. Therefore, it is essential for business owners to take proactive steps to address their business rates liability on empty property.
In conclusion, business owners can explore various strategies to avoid business rates on empty property, including checking for exemptions, considering temporary occupation, demolishing or refurbishing the property, and negotiating for discretionary rate relief. By being proactive and seeking out potential options for reducing their business rates liability, business owners can effectively manage their costs while ensuring compliance with local regulations. It is advisable for business owners to seek professional advice from a surveyor or tax specialist to discuss their specific circumstances and explore the best course of action for avoiding business rates on empty property.