empty building business rates relief, also known as unoccupied property rate relief, is a topic that is often misunderstood by commercial property owners and businesses. In this article, we will delve into the details of this relief scheme, its eligibility criteria, and how it can benefit property owners.
Business rates are taxes that are levied on commercial properties by local authorities in the UK. The rateable value of a property is used to calculate the amount of business rates that need to be paid. However, when a property is left vacant, property owners may be eligible for empty building business rates relief.
The main objective of empty building business rates relief is to encourage property owners to bring vacant properties back into use. By providing financial incentives in the form of relief from business rates, local authorities hope to reduce the number of empty buildings in their area and promote economic growth.
In England, empty building business rates relief is available for both commercial and industrial properties. The relief period varies depending on the type of property:
1. Commercial properties – for the first three months, 100% empty building relief is granted. Following this initial period, the property owner will be eligible for a 50% discount on their business rates.
2. Industrial properties – A 100% empty building relief is granted for the first six months. After this period, the property owner will be eligible for a discount of 50% on their business rates.
It is important to note that these relief periods may vary in different regions, so property owners are advised to check with their local authority for specific details.
In Scotland, the rules for empty building business rates relief are slightly different. The relief period is determined by the Scottish government and can vary depending on the location and type of property. Property owners in Scotland are advised to contact the Scottish Assessors Association for more information on eligibility and relief periods.
While empty building business rates relief can provide significant cost savings for property owners, there are some key points to bear in mind:
1. The relief is granted only on the condition that the property remains empty. If the property is brought back into use, the relief will no longer apply, and business rates will need to be paid in full.
2. Property owners must inform their local authority as soon as the property becomes vacant to ensure that they receive the relief from the start of the empty period.
3. empty building business rates relief is not automatic – property owners need to apply for the relief and provide evidence to support their application. Failure to do so may result in full business rates being charged.
4. The relief does not apply to properties that are exempt from business rates, such as agricultural land and buildings, fish farms, and certain listed buildings.
In recent years, the UK government has made changes to the empty building business rates relief scheme in an effort to further encourage property owners to bring vacant properties back into use. These changes include:
1. Introducing a new relief scheme for newly built properties – property owners of newly constructed commercial and industrial properties may be eligible for a relief of up to 100% for the first 18 months.
2. Increasing the relief period for certain types of properties – for example, in response to the COVID-19 pandemic, the government extended the relief period for retail, leisure, and hospitality properties to 100% for the 2020/21 financial year.
empty building business rates relief can be a valuable incentive for property owners looking to reduce their overheads and make their properties more attractive to potential tenants. By understanding the eligibility criteria and rules of the relief scheme, property owners can take advantage of this financial support and contribute to the revitalization of empty buildings in their area.