Empty rates on commercial property, also known as vacant rates, can be a costly burden for property owners These rates are charged by the local authorities on commercial buildings that are empty or unoccupied for an extended period of time In the UK, empty rates on commercial property can be a significant expense that many property owners struggle to manage In this article, we will examine what empty rates are, how they are calculated, and offer some solutions for property owners to mitigate these costs.
Empty rates on commercial property were introduced in the UK as a way to discourage property owners from leaving their buildings vacant for long periods of time The idea is to incentivize property owners to occupy their buildings or to lease them out to avoid incurring these extra costs These rates are separate from standard business rates, which are based on the rateable value of the property.
Empty rates are calculated based on a property’s rateable value, which is assessed by the Valuation Office Agency (VOA) The rates are payable after a property has been empty for a certain period of time, which varies depending on the property’s size and location In most cases, empty rates are charged at the full rateable value for the first three months that a property is empty After that, the rate is typically reduced to half of the rateable value However, for certain properties, such as industrial buildings, the full rate can be charged after just three weeks of vacancy.
Property owners must be aware of the rules and regulations surrounding empty rates on commercial property to avoid any unexpected costs It is important to keep in mind that even if a property is temporarily unoccupied, it may still be liable for empty rates empty rates commercial property. Property owners should also be aware of any exemptions or reliefs that may apply to their specific situation, as there are some circumstances in which empty rates may not be payable.
There are some strategies that property owners can employ to reduce the impact of empty rates on commercial property One option is to work with a specialist rating consultant who can help navigate the complex world of business rates and empty rates These consultants can assist in challenging the rateable value of the property or applying for any available reliefs or exemptions By seeking professional advice, property owners can ensure that they are not paying more than necessary in empty rates.
Another option for property owners is to consider short-term leases or licenses for their empty properties By leasing out the property on a temporary basis, even for a short period of time, property owners can avoid incurring empty rates This can also provide an opportunity to generate some income from the property while it is vacant Property owners should carefully consider the terms of any lease or license agreement to ensure that it aligns with their long-term goals for the property.
Property owners may also want to explore the option of occupying the property themselves or using it for a different purpose By utilizing the property for their own business or converting it into a different type of space, property owners can avoid empty rates altogether This may require some investment in refurbishment or reconfiguration, but it could ultimately save money in the long run by eliminating empty rates.
Overall, empty rates on commercial property can be a significant burden for property owners, but there are options available to help manage these costs By understanding the rules and regulations surrounding empty rates, seeking professional advice, and exploring alternative uses for the property, property owners can mitigate the impact of empty rates and make the most of their commercial properties.