Business rates are taxes that businesses in the UK pay on the properties they occupy. These rates are calculated based on the rateable value of the property and are paid to the local council. But what happens when a commercial property becomes vacant? This is where void business rates come into play.
void business rates are the rates that a business owner must still pay on a property that is empty or “void” for a certain period of time. While the rules around void business rates can be complex, it is important for business owners to understand their obligations to avoid any unexpected financial burdens.
One of the key things to note about void business rates is that they are not automatically waived simply because a property is vacant. In fact, business owners are required to continue paying business rates on a vacant property unless certain exemptions apply.
The first exemption that may apply is the small business rates relief. This relief provides a discount on business rates for small businesses with a rateable value below a certain threshold. If a business qualifies for small business rates relief and their property becomes vacant, they may be eligible for a discount on their void business rates.
Another exemption that may apply is the newly built property exemption. This exemption provides relief on void business rates for new properties that have been vacant for a certain period of time. This exemption is meant to encourage the development of new properties and prevent them from becoming a burden on business owners.
Business owners should also be aware of the three-month exemption. This exemption allows businesses to receive a full exemption on void business rates for the first three months that their property is vacant. After the initial three-month period, business owners are required to pay the full amount of void business rates unless another exemption applies.
It is important for business owners to be proactive in applying for any exemptions that may apply to their situation. Failing to do so can result in unexpected financial burdens and penalties for non-payment of void business rates.
There are also practical measures that business owners can take to minimize their void business rates. For example, if a property is undergoing refurbishment or repairs, business owners may be able to apply for a temporary exemption or reduction in void business rates. Additionally, business owners should ensure that they notify the local council as soon as a property becomes vacant to avoid any unnecessary charges.
In some cases, business owners may find themselves facing void business rates on a property that is difficult to let or sell. This can be a significant financial burden, especially for small businesses or property owners with limited resources. In these situations, it may be worth seeking professional advice from a surveyor or property expert to explore all available options for mitigating void business rates.
It is also worth noting that changes to void business rates regulations are being considered by the UK government. In response to the economic impact of the COVID-19 pandemic, the government has introduced temporary measures to provide relief on business rates for certain businesses, including those that have been forced to close due to restrictions.
Business owners should stay informed about any updates to void business rates regulations to ensure that they are in compliance with the law and taking advantage of any available relief measures. By staying proactive and seeking professional advice when needed, business owners can navigate the complexities of void business rates and minimize any financial burdens associated with vacant properties.
In conclusion, void business rates are an important consideration for business owners with vacant properties. Understanding the rules around void business rates and staying proactive in applying for exemptions are key steps to managing this financial obligation. By staying informed and seeking professional advice when needed, business owners can navigate void business rates with confidence and avoid any unexpected financial burdens.