When it comes to owning commercial property, there are many expenses that need to be considered. One of the costs that often catches property owners off guard is the rates payable on empty commercial property. These rates, also known as business rates, can add up quickly and significantly impact the bottom line of property owners. In this article, we will discuss what rates payable on empty commercial property are, how they are calculated, and what property owners can do to mitigate these costs.
rates payable on empty commercial property are essentially a tax that property owners are required to pay to the local government. These rates are calculated based on the rateable value of the property, which is assessed by the Valuation Office Agency (VOA). The rateable value is an estimate of the open market rental value of the property as of a specific date. This value is then used to determine the amount of rates payable on the property.
In the United Kingdom, rates payable on empty commercial property are a significant concern for property owners. Since 2008, empty property relief has been significantly reduced, which has led to an increase in the rates payable on vacant commercial properties. As a result, property owners are now facing higher costs for keeping their properties empty.
The rates payable on empty commercial property are calculated based on a multiplier set by the government. This multiplier is known as the Uniform Business Rate (UBR) and is set annually. The UBR is multiplied by the rateable value of the property to determine the amount of rates payable. In addition to the UBR, there may be additional charges or reliefs that can affect the final amount of rates payable on a property.
Property owners should be aware that rates payable on empty commercial property can add up quickly. In some cases, property owners may find themselves paying thousands of pounds annually for empty properties. This can be a significant burden, especially for property owners who are struggling to find tenants for their commercial properties.
There are, however, steps that property owners can take to mitigate the costs of rates payable on empty commercial property. One option is to seek exemptions or reliefs that may be available. For example, some property owners may be eligible for a three-month exemption from rates payable on newly vacant properties. This can provide some temporary relief for property owners who are in the process of finding new tenants.
Another option for property owners is to appeal the rateable value of the property. If a property owner believes that the rateable value assessed by the VOA is incorrect, they have the right to appeal. By appealing the rateable value, property owners may be able to reduce the amount of rates payable on their property.
Property owners may also consider other strategies for mitigating the costs of rates payable on empty commercial property. For example, property owners may consider leasing their empty property for temporary or short-term uses. This can help generate some income from the property while also reducing the amount of rates payable.
In conclusion, rates payable on empty commercial property are a significant concern for property owners. These rates can add up quickly and significantly impact the bottom line of property owners. Property owners should be aware of how rates payable on empty commercial property are calculated and what options are available for mitigating these costs. By taking proactive steps and exploring potential exemptions or reliefs, property owners can reduce the financial burden of rates payable on empty commercial property.