When it comes to owning commercial property, one of the many expenses that owners must account for is the rates payable on empty properties. These rates can be a significant financial burden, especially if the property remains vacant for an extended period of time. In this article, we will explore what rates payable on empty commercial property are, how they are calculated, and some strategies for minimizing this cost.
rates payable on empty commercial property, also known as empty property rates, are taxes that property owners must pay on commercial properties that are not occupied. These rates are imposed by local authorities and are meant to incentivize property owners to keep their properties occupied and in use. The idea behind these rates is to discourage property owners from allowing their properties to remain empty for long periods, as vacant properties can have a negative impact on the surrounding community and economy.
The rates payable on empty commercial property are calculated based on the rateable value of the property. The rateable value is determined by the local authority and is used to calculate the annual business rates that must be paid on the property. When a property becomes empty, the owner is still required to pay these rates, although they may be entitled to certain exemptions or discounts.
One common exemption for empty property rates is the small business rate relief scheme. Under this scheme, properties with a rateable value of £15,000 or less may be eligible for a discount on their rates. Additionally, properties with a rateable value of £12,000 or less may be entitled to full relief and therefore would not have to pay any rates on their empty property. It is important for property owners to check with their local authority to see if they qualify for any exemptions or discounts on their empty property rates.
In some cases, property owners may be able to apply for temporary exemptions from empty property rates. This typically applies to properties that are undergoing repairs or renovations, or are otherwise temporarily vacant. Owners may need to provide evidence to the local authority to support their application for a temporary exemption. It is important to note that these exemptions are often temporary and may only be granted for a limited period of time.
Property owners may also be able to apply for a hardship relief scheme if they are struggling to pay their empty property rates. This scheme is aimed at supporting property owners who are facing financial difficulties and are unable to pay their rates in full. Owners may need to provide evidence of their financial situation to the local authority in order to qualify for hardship relief.
There are a number of strategies that property owners can employ to minimize the cost of rates payable on empty commercial property. One option is to consider leasing out the property on a short-term basis, even if it is only for a limited period of time. By doing so, owners may be able to generate some income from the property and avoid paying full empty property rates.
Another strategy is to consider working with a property management company to help find tenants for the property. These companies typically have expertise in marketing properties and may be able to attract tenants more quickly than if the owner were to do so on their own. By finding a tenant for the property, owners can avoid paying empty property rates altogether.
In conclusion, rates payable on empty commercial property can be a significant financial burden for property owners. However, there are a number of exemptions, discounts, and relief schemes available that can help to minimize this cost. By exploring these options and considering strategies for keeping the property occupied, owners can better manage the expense of rates payable on empty commercial property.