When it comes to owning and managing commercial property, one of the considerations that property owners must keep in mind is the rates payable on empty commercial property. These rates, also known as non-domestic rates or business rates, are a tax that is levied on non-residential properties such as shops, offices, warehouses, and factories. Understanding how these rates are calculated and payable on empty commercial property is important for property owners to avoid unnecessary financial burdens.
Non-domestic rates are a tax that is collected by local authorities in the UK to fund local services such as education, transportation, and waste removal. The rates payable on commercial property are based on the rateable value of the property, which is determined by the Valuation Office Agency (VOA) in England, the Scottish Assessors Association in Scotland, and the local council in Wales. The rateable value is an estimate of the annual rental value of the property on a specified date.
When a commercial property becomes empty, the owner is still liable to pay business rates on the property. The rates payable on empty commercial property are determined by the specific rules and regulations set by the local authority where the property is located. In England, the government has provided some relief for empty commercial properties through various schemes and exemptions.
One of the relief schemes available to property owners is the empty property rate relief. Under this scheme, owners of commercial properties that have been empty for a certain period of time are entitled to a discount on their rates. In England, properties that have been empty for three months are entitled to a 100% discount on rates for the next three months. After the initial three months, the property owner may be eligible for a further 100% discount if the property is still empty. However, it is important to note that the rules for empty property rate relief may vary between different local authorities.
Another form of relief for property owners is the small business rate relief. This scheme is aimed at supporting small businesses by providing them with a discount on their business rates. If a property owner leases out their empty commercial property to a small business, the small business rate relief may apply. The amount of relief depends on the rateable value of the property and the size of the business.
In addition to relief schemes, there are also exemptions available for certain types of empty commercial properties. Properties that are exempt from paying business rates include those that are owned by charities, community amateur sports clubs, and industrial premises that are being renovated. It is important for property owners to check if their property qualifies for any exemptions to avoid paying unnecessary rates on empty commercial property.
While relief schemes and exemptions can help alleviate the financial burden of paying rates on empty commercial property, property owners must still be aware of their obligations and plan accordingly. Failure to pay business rates on empty commercial property can result in penalties and legal action by the local authority. It is important for property owners to keep in touch with the local authority and inform them of any changes in the occupancy status of their property.
In conclusion, understanding the rates payable on empty commercial property is vital for property owners to avoid unnecessary financial burdens. Relief schemes and exemptions are available to help alleviate the cost of paying rates on empty commercial property, but property owners must still be aware of their obligations and plan accordingly. By staying informed and proactive, property owners can manage the rates payable on empty commercial property effectively and avoid any potential issues with the local authority.