The business rates empty property exemption, also known as the empty property relief, is a policy introduced by the government to provide some relief to businesses that have vacant properties. This exemption allows businesses to be exempt from paying business rates on empty properties for a certain period of time. The purpose of this exemption is to reduce the financial burden on businesses that have empty properties and encourage them to bring these properties back into use.
Business rates are a tax that businesses in the UK have to pay on the non-domestic properties they occupy. These rates are calculated based on the rental value of the property and are used to fund local services such as schools, roads, and emergency services. However, when a property becomes vacant, businesses can apply for the empty property exemption to avoid paying these rates.
The length of time for which a property can qualify for the empty property exemption varies depending on the type of property and the location. In most cases, the exemption lasts for three months for industrial properties and six months for commercial properties. After this initial period, businesses may still be eligible for a further three or six months of relief, depending on the discretion of the local authority.
It is important for businesses to be aware of the regulations surrounding the empty property exemption, as failure to comply with these regulations can result in penalties and fines. For example, if a business fails to notify the local authority that a property has become vacant, they may lose their entitlement to the exemption and be required to pay the full business rates.
Businesses should also be aware that the empty property exemption does not apply to all properties. Certain types of properties, such as listed buildings and properties with a rateable value of less than £2,900, are exempt from business rates regardless of whether they are empty or occupied. Additionally, properties that are unoccupied due to a compulsory purchase order or pending planning permission may also be exempt from the empty property exemption.
While the empty property exemption can provide some relief to businesses with vacant properties, it is important for businesses to consider the potential consequences of leaving a property empty for an extended period of time. Vacant properties can attract vandalism, squatters, and other unwanted attention, which can be costly to address. Additionally, leaving a property empty can result in a loss of rental income and potential damage to the property itself.
Businesses that are considering leaving a property empty should carefully weigh the benefits of the empty property exemption against the potential risks and costs associated with leaving the property vacant. In some cases, it may be more cost-effective to rent out the property at a reduced rate or explore other options for bringing the property back into use.
Overall, the business rates empty property exemption can provide some relief to businesses that have vacant properties, allowing them to avoid paying business rates for a certain period of time. However, businesses should be aware of the regulations surrounding this exemption and consider the potential consequences of leaving a property empty. By carefully weighing the benefits and risks, businesses can make informed decisions about how to manage their vacant properties effectively.