Business rates are one of the many expenses that commercial property owners have to deal with. These rates are essentially a tax that is paid on non-domestic properties, such as shops, offices, factories, and warehouses. The amount of business rates that a company has to pay is determined by the rateable value of the property, which is set by the government’s Valuation Office Agency.
However, what happens when a commercial property is empty and not generating any income? This is where void business rates come into play. void business rates are a separate charge that property owners have to pay when their commercial property is unoccupied. In this article, we will delve deeper into void business rates and everything you need to know about them.
When a commercial property becomes unoccupied, the owner is still liable to pay business rates on the property. This is because the property is still deemed to have a rateable value, even if it is not being used to generate any income. void business rates are charged at the same rate as standard business rates, and they can be a significant financial burden for property owners, especially if the property remains unoccupied for an extended period.
One of the main reasons why void business rates exist is to discourage property owners from leaving their commercial properties empty for long periods. The government wants to incentivize property owners to either rent out their properties or actively use them for some other purpose. By charging void business rates, the government hopes to encourage property owners to find tenants or buyers for their empty properties and help boost economic activity in the area.
It is important for property owners to be aware of void business rates and how they can affect their finances. Not only do property owners have to pay the standard business rates on their occupied properties, but they also have to factor in void business rates if their properties become unoccupied. This can be a double financial blow for property owners, especially during tough economic times when finding tenants or buyers for commercial properties can be challenging.
There are, however, certain exceptions and reliefs that property owners can apply for to help reduce the burden of void business rates. For example, small business rate relief may be available to businesses that only occupy one property and have a rateable value below a certain threshold. This relief can help reduce the amount of business rates that a property owner has to pay, both for occupied and unoccupied properties.
Property owners can also apply for relief on an unoccupied property if it is being renovated or undergoing repairs. This can provide some temporary relief from void business rates while the property is being brought back into use. However, it is important for property owners to note that relief or exemptions from void business rates are not automatic and need to be actively applied for.
In some cases, property owners may be able to negotiate with the local council to come to an agreement on void business rates. This could involve setting up a temporary payment plan or exploring other ways to reduce the financial burden of void business rates on the property owner. It is worth speaking to the local council and seeking advice on how to best manage void business rates for an unoccupied property.
Overall, void business rates can be a significant financial burden for commercial property owners, especially during times of economic uncertainty. Property owners need to be proactive in managing void business rates and exploring options for relief or exemptions. By understanding void business rates and how they can impact their finances, property owners can make informed decisions about their commercial properties and work towards minimizing the financial impact of void business rates.