When it comes to owning property, there are often expenses that come with it – maintenance, taxes, and utility bills, to name a few. One tax that property owners may be particularly concerned about is business rates, especially when a property is left empty. Business rates are taxes that businesses must pay on their non-domestic properties, including any empty property they may own. However, there are ways to potentially avoid or reduce these rates on an empty property. In this article, we will discuss five strategies for avoiding business rates on empty property.
1. Temporary exemption
One strategy for avoiding business rates on empty property is to apply for a temporary exemption. In certain circumstances, a property may be exempt from business rates for a limited period of time. For example, if the property is undergoing major repairs or renovations, or if it is waiting for a new tenant to move in, it may be eligible for a temporary exemption from business rates. It is important to check with your local council to see if your empty property qualifies for this exemption and to apply for it as soon as possible.
2. Partial occupation
Another strategy for avoiding business rates on empty property is to consider partially occupying the property. If you can find a temporary or short-term tenant to occupy even a small portion of the property, you may be able to reduce the amount of business rates you are required to pay. By demonstrating that the property is actively being used, even if only in part, you may be able to avoid paying the full amount of business rates on the empty property. This can be a useful strategy for property owners who are struggling to find a long-term tenant or who are in the process of refurbishing the property.
3. Change of use
One way to potentially avoid business rates on empty property is to consider a change of use for the property. If the property is currently classified as a commercial property, you may be able to change its use to residential or mixed-use in order to reduce or eliminate the business rates. Residential properties are typically exempt from business rates, so converting your empty property to a residential use may be a smart way to avoid this tax. However, it is important to note that changing the use of a property may require planning permission and other legal considerations, so be sure to consult with a professional before pursuing this strategy.
4. Short-term lease agreements
Property owners who are struggling to find a long-term tenant for their empty property may consider entering into short-term lease agreements with temporary tenants or businesses. By offering the property for lease on a short-term basis, you can generate income from the property while also potentially reducing the amount of business rates you are required to pay. Short-term lease agreements can be an effective way to mitigate the financial burden of owning an empty property and may provide a practical solution for property owners who are unable to find a long-term tenant.
5. Negotiate with the local council
Finally, property owners who are facing high business rates on their empty property may consider negotiating with their local council to see if there are any options for reducing or deferring the tax. In some cases, councils may be willing to offer discounts or payment plans for property owners who are struggling to pay their business rates. By opening a dialogue with the council and explaining your circumstances, you may be able to come to a mutually beneficial arrangement that helps you avoid or reduce the burden of business rates on your empty property.
In conclusion, there are several strategies that property owners can consider for avoiding business rates on empty property. From applying for temporary exemptions to changing the use of the property, there are options available for reducing or eliminating this tax burden. By exploring these strategies and seeking professional advice where necessary, property owners can take proactive steps to mitigate the financial impact of owning an empty property and ensure that they are not paying more than necessary in business rates.
Ultimately, each property owner’s situation will be unique, so it is important to carefully consider the options available and choose the strategy that best suits your individual circumstances. By taking proactive steps and exploring creative solutions, property owners can potentially avoid business rates on empty property and better manage their tax liabilities.