When it comes to owning commercial property, there are many costs and expenses that owners must account for. One of these expenses is the rates payable on empty commercial property. These rates can often be a significant financial burden for property owners, particularly if their 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 what property owners can do to minimize this cost.
rates payable on empty commercial property, also known as empty property rates or non-domestic rates, are taxes that property owners must pay on commercial properties that are unoccupied. These rates are separate from the regular business rates that are paid on occupied commercial properties. The purpose of these rates is to encourage owners to put their empty properties back into use, rather than leaving them vacant for extended periods of time.
The rates payable on empty commercial property are typically charged at a rate of 100% of the full business rates that would be payable if the property were occupied. However, there are some exceptions to this rule. For example, if a property has been vacant for less than three months, the owner may be eligible for a three-month exemption from empty property rates. Additionally, some properties may be exempt from empty property rates altogether, such as newly constructed properties that have not yet been occupied.
The calculation of rates payable on empty commercial property can vary depending on the location of the property and its rateable value. Rateable value is determined by the Valuation Office Agency (VOA) and is used to calculate the amount of business rates that a property is liable for. The rateable value of a property is based on factors such as its size, location, and intended use.
To calculate the rates payable on empty commercial property, the rateable value of the property is multiplied by the empty property rate multiplier. This multiplier is set annually by the government and is used to determine the amount of empty property rates that a property owner must pay. For example, if a property has a rateable value of £50,000 and the empty property rate multiplier is set at 50p, the owner would be required to pay £25,000 in empty property rates per year.
Property owners who are struggling to pay the rates on their empty commercial property may be able to take advantage of certain reliefs and exemptions. For example, properties that are undergoing major renovation or repair work may be eligible for a temporary exemption from empty property rates. Additionally, properties that are deemed to be uneconomical to repair may be eligible for a long-term exemption from empty property rates.
Property owners who are unable to pay the rates on their empty commercial property may also be able to negotiate a payment plan with their local council. This can help to spread the cost of the rates over a longer period of time, making it more manageable for property owners who are experiencing financial difficulties.
In conclusion, rates payable on empty commercial property can be a significant financial burden for property owners. Understanding how these rates are calculated and what exemptions and reliefs are available can help property owners to minimize this cost. By working with their local council and exploring all available options, property owners can reduce the financial impact of empty property rates and ensure that their properties remain in compliance with tax regulations.