When it comes to managing a commercial property portfolio, one of the key challenges that property owners face is dealing with business rates on empty properties. Business rates can be a significant financial burden, especially when properties are vacant and not generating any income. However, there are several strategies that property owners can use to minimize their business rates liability on empty properties. In this article, we will discuss some of the most effective ways to avoid business rates on empty property.
One of the most common ways to avoid business rates on empty property is by applying for an exemption or relief. There are several different types of relief available to property owners, depending on the circumstances of the property and the reason for its vacancy. For example, properties that are undergoing refurbishment or structural repairs may be eligible for a temporary exemption from business rates. Similarly, properties that are in a designated enterprise zone or are classified as hardship cases may also be eligible for relief from business rates.
It is important for property owners to be proactive in applying for these exemptions and reliefs, as they are not always automatic and may require supporting documentation or evidence to be provided. Property owners should familiarize themselves with the specific criteria for each type of relief and ensure that they meet all the necessary requirements before submitting an application.
Another effective strategy for avoiding business rates on empty property is by exploring the option of temporary occupation. This involves allowing a third party to occupy the property on a short-term basis, even if the property is ultimately intended to remain vacant. By doing so, property owners may be able to benefit from exemptions or reliefs that are available to occupied properties, such as Small Business Rate Relief or charitable relief.
Property owners should be aware that temporary occupation does not necessarily need to involve renting out the property for commercial use. It could also include using the property for temporary storage or allowing a charity or community group to use the premises for a limited period. By exploring creative ways to temporarily occupy the property, property owners may be able to reduce their business rates liability and generate some income in the process.
In some cases, property owners may also be able to avoid business rates on empty property by applying for a material change of use. This involves demonstrating that the property is no longer suitable for its original intended use and should therefore be reclassified for a different purpose. For example, a former office building that is no longer viable for office use could potentially be reclassified as a residential property, which may carry a lower rateable value and therefore lower business rates liability.
Property owners should consult with a professional surveyor or valuer to assess whether a material change of use application is likely to be successful in their particular circumstances. It is important to gather evidence to support the case for reclassification, such as planning permission for a change of use or quotations for building works to convert the property to a different use. By demonstrating a genuine intention to repurpose the property, property owners may be able to avoid business rates on empty property and potentially unlock new opportunities for development or investment.
In conclusion, avoiding business rates on empty property can be a complex and challenging process, but with the right approach and strategy, property owners can minimize their financial liability and make the most of their commercial property portfolio. By exploring options such as applying for exemptions or reliefs, temporary occupation, and material change of use, property owners can effectively manage their business rates liability and create opportunities for the future. It is important for property owners to stay informed about changes to business rates legislation and seek professional advice to ensure that they are taking full advantage of all available options to minimize their business rates on empty property.