Business rates can be a significant cost for property owners, especially when their buildings sit empty. However, there are ways to legally avoid paying business rates on empty property. In this article, we will discuss some of the strategies that property owners can implement to reduce or altogether eliminate their business rates liability.
One common way to avoid paying business rates on empty property is by claiming an exemption. In the United Kingdom, for example, most commercial properties are subject to business rates, but there are certain exemptions available for empty buildings. If a property is unoccupied for a certain period of time, the owner may be eligible for a “Empty Property Rate Relief”. This relief can provide a significant reduction in business rates, with some properties being exempt from paying any rates at all for a set period.
It’s important to note that the rules and regulations surrounding empty property exemptions vary by location, so property owners should check with their local council to determine their eligibility. By taking advantage of these exemptions, property owners can save a substantial amount of money on business rates while their buildings are vacant.
Another way to avoid business rates on empty property is by actively using the space for short-term or temporary purposes. For example, property owners can rent out their empty buildings for events, pop-up shops, or temporary storage. By generating income from these temporary uses, property owners can demonstrate that the building is not solely empty for the purpose of avoiding business rates.
Additionally, property owners can consider converting their empty buildings into residential properties. In many jurisdictions, residential properties are either exempt from business rates or subject to lower rates than commercial properties. By converting an empty commercial building into a residential property, owners can potentially reduce their business rates liability and create a new revenue stream through renting or selling the residential units.
Another effective strategy for avoiding business rates on empty property is by taking advantage of the “Material Change of Circumstances” provision. This provision allows property owners to temporarily suspend their business rates liability if they can demonstrate that the property has undergone a significant change that renders it unsuitable for occupation.
For example, if a property is damaged by a fire or flood and becomes uninhabitable, the owner may be able to apply for a “Material Change of Circumstances” to suspend their business rates liability until the property is repaired and occupied again. This provision can provide temporary relief for property owners facing unexpected challenges that prevent them from using their buildings.
Furthermore, property owners can consider leasing their empty buildings to charitable organizations or community groups. In many jurisdictions, properties used for charitable purposes are exempt from business rates. By leasing their buildings to eligible organizations, property owners can not only avoid paying business rates but also support causes that align with their values.
It’s important for property owners to stay informed about the regulations and exemptions related to business rates in their area. By understanding their options and taking proactive steps to reduce their business rates liability, property owners can minimize their financial burden while their buildings are empty.
In conclusion, there are several strategies that property owners can employ to avoid paying business rates on empty property. By claiming exemptions, using the space for temporary purposes, converting the building to residential use, utilizing the “Material Change of Circumstances” provision, and leasing to charitable organizations, owners can reduce or eliminate their business rates liability while their buildings sit vacant. By staying informed and taking proactive steps, property owners can effectively manage their costs and make the most of their empty properties.