Understanding The Rates Payable On Empty Commercial Property
When it comes to owning commercial property, one of the key considerations for landlords and property owners is the rates payable on the property. Rates are essentially taxes that are levied on all non-domestic properties, including commercial buildings. However, what many property owners may not be aware of is that rates are still payable on commercial properties that are empty or unoccupied.
This article will delve into the specifics of rates payable on empty commercial properties, providing a comprehensive overview of what property owners can expect when their commercial property is vacant.
Understanding Rates on Commercial Property
Before diving into the details of rates on empty commercial property, it’s important to first understand how rates are calculated for commercial properties in general. In the UK, rates are determined based on the rateable value of a property, which is assessed by the Valuation Office Agency (VOA). The rateable value is essentially an estimate of the annual rental value of a property on a specific date.
Once the rateable value is determined, it is then multiplied by the current multiplier set by the government to calculate the rates payable for the property. The multiplier is set annually and is used to calculate the amount of rates payable based on the rateable value of the property.
Rates on Empty Commercial Property
When a commercial property becomes empty or unoccupied, property owners may assume that they are no longer required to pay rates on the property. However, this is not the case. Rates are still payable on empty commercial properties, but there are some exemptions and reliefs that property owners may be eligible for.
Empty Property Relief
One of the main ways that property owners can reduce the amount of rates payable on their empty commercial property is through Empty Property Relief. Under this scheme, property owners can receive a 100% discount on their rates for a certain period of time, depending on the type of property.
For example, most commercial properties are eligible for Empty Property Relief for the first three months that they are empty. After this initial three-month period, the property owner may still be eligible for a 50% discount on their rates for an additional three months. However, it’s important to note that different local authorities may have their own guidelines and criteria for Empty Property Relief, so property owners should check with their local council for more information.
Listed Buildings and Heritage Properties
In some cases, listed buildings and heritage properties may be exempt from paying rates on empty commercial property. This exemption is intended to encourage the preservation and maintenance of historic buildings that may be difficult to rent or develop. Property owners of listed buildings should consult with their local council or Historic England to determine if their property is eligible for this exemption.
Small Business Rates Relief
Another way that property owners can reduce the amount of rates payable on empty commercial property is through Small Business Rates Relief. This relief is available to businesses that occupy one property with a rateable value below a certain threshold. In some cases, property owners may still be eligible for this relief even if their property is empty, as long as they meet the criteria set by the local council.
Conclusion
In conclusion, rates are still payable on empty commercial property, but property owners should be aware of the exemptions and reliefs that they may be eligible for. By understanding the rates payable on empty commercial property and exploring the various relief options available, property owners can effectively manage their costs and obligations when their property is vacant. It’s important to consult with the local council or a qualified professional to determine the specific rates payable on a particular property and to explore potential avenues for relief.