As a commercial property owner, one of the challenges that you may face is dealing with business rates on empty properties. Business rates are taxes that all non-domestic property owners must pay to their local council, and they can certainly add up, especially if your property sits vacant for an extended period of time. Understanding how business rates on empty commercial property work and how to navigate their impact can help you make informed decisions and minimize financial strain.
The Impact of Business Rates on Empty Commercial Property
When a commercial property becomes empty, the owner is still liable to pay business rates on that property. This is due to the fact that the property still holds value and services provided by the local council, such as waste collection and security, are still needed. However, paying business rates on a property that is not generating any income can be a significant financial burden for property owners, especially during challenging economic times.
In the past, the government provided relief for empty commercial properties, allowing owners to claim exemption from paying business rates for a certain period of time. However, these relief schemes have been subject to change in recent years, with some being reduced or removed altogether. This has left many property owners facing higher business rates bills on their empty properties.
Navigating the Impact of Business Rates on Empty Commercial Property
So, what can property owners do to navigate the impact of business rates on empty commercial property? Here are some strategies to consider:
1. Explore Relief Options: Despite the changes to relief schemes, there are still some options available for property owners to reduce their business rates on empty properties. For example, you may be able to claim small business rate relief if your property meets certain criteria. It’s important to research and understand the relief options that may be available to you.
2. Consider Temporary Solutions: If you anticipate that your property will be empty for a short period of time, consider temporary solutions such as short-term leasing or pop-up shops. This can help generate some income while reducing the burden of paying full business rates on an empty property.
3. Appeal the Rateable Value: If you believe that the rateable value of your empty property is too high, you may have the option to appeal to the Valuation Office Agency (VOA) to have it reassessed. A lower rateable value would result in lower business rates bills for your property.
4. Seek Professional Advice: Dealing with business rates on empty commercial property can be complex, so it may be beneficial to seek advice from a professional, such as a chartered surveyor or tax advisor. They can help you understand your options and navigate the process effectively.
5. Explore Alternative Uses: If your property has been sitting empty for a long time and you’re struggling to pay the business rates, consider exploring alternative uses for the property. This could include converting it into residential units, coworking spaces, or retail outlets. Not only can this help generate income, but it can also breathe new life into the property.
In conclusion, navigating the impact of business rates on empty commercial property can be challenging, but with the right strategies and solutions in place, property owners can minimize the financial strain and make informed decisions. By exploring relief options, considering temporary solutions, appealing the rateable value, seeking professional advice, and exploring alternative uses, property owners can better manage the impact of business rates on their empty commercial properties.