One of the challenges that business owners face is dealing with the costs of owning property, especially when it is empty. Business rates on empty properties can add up quickly and become a burden on the financial health of a company. However, there are strategies that business owners can use to avoid or minimize these business rates.
Business rates are taxes that are paid on most non-domestic properties, including shops, offices, warehouses, and factories. The rates are usually calculated based on the rateable value of the property, which is determined by the Valuation Office Agency (VOA). In the UK, the business rates are set by the government and local authorities, and they can be a significant expense for property owners.
One way to avoid business rates on empty property is to apply for an exemption. In some cases, properties that are empty for a certain period of time may be exempt from paying business rates. For example, properties that are undergoing major repairs or renovations may be eligible for a temporary exemption. Business owners should check with their local authority to see if they qualify for any exemptions based on the circumstances of their empty property.
Another way to avoid business rates on empty property is to actively market the property for rent or sale. If a property is actively being marketed, business owners may be able to claim a three-month exemption from business rates. However, in order to qualify for this exemption, the property must be available for rent or sale at a realistic price. Business owners should make sure that the property is listed with a reputable agent and that all efforts are being made to find a tenant or buyer.
Business owners can also consider applying for empty property relief. This relief is available for properties that have been empty for a long period of time, usually six months or more. The relief provides a 100% discount on business rates for the first three months that the property is empty, and a 50% discount for the following three months. Business owners should keep in mind that empty property relief is not automatic and they will need to apply for it through their local council.
In some cases, business owners may be able to avoid paying business rates on empty property by using it for a charitable purpose. Properties that are being used for charitable purposes may be eligible for relief or exemption from business rates. Business owners should check with their local council to see if their property qualifies for any charitable relief.
Business owners can also consider leasing the property to a charity or community group. Properties that are leased to charities or community groups may be eligible for relief from business rates, even if they are empty. This can be a win-win situation for business owners, as they may be able to earn rental income from the charity while also avoiding paying business rates on the property.
Overall, business owners have several options for avoiding business rates on empty property. By applying for exemptions, actively marketing the property, applying for empty property relief, using the property for charitable purposes, or leasing it to a charity or community group, business owners can minimize the financial impact of owning an empty property. It is important for business owners to stay informed about their options and to work closely with their local council to take advantage of any relief or exemptions that may be available to them.
In conclusion, business owners can take proactive steps to avoid paying business rates on empty property. By exploring their options for exemptions, relief, and charitable use, business owners can reduce the financial burden of owning an empty property and protect the financial health of their company. It is important for business owners to be aware of their options and to take advantage of any opportunities to minimize their business rates on empty property.