Business Rates will not be payable in the first three months that the property is empty. This is extended to six months in the case of certain industrial properties.
After the initial three or six month ‘free period’ has expired, the person who is “entitled to possession” of the empty property will be liable for 100 per cent of the basic occupied Business Rates unless:
- Its Rateable Value is less than £2,600. (Between 1 April 2010 and 31 March 2011 this threshold was set at £18,000, between 1 April 2009 and 31 March 2010 it was £15,000).
- It is a Listed building or scheduled ancient monument.
- It is held by a registered charity or community amateur sports club and appears likely to be next used for the same purposes.
- The owner is a company which is subject to a winding-up order or is a company in administration, or in liquidation.
- The owner is an un-discharged bankrupt within the meaning of section 381(2) of the Insolvency Act 1986.
- The owner is entitled to possession only in his or her capacity as the personal representative of a deceased person.
- The owner is, in certain circumstances, prohibited by law or an action of the Crown from occupying the property.
The person or company “entitled to possession” is either the owner or leaseholder. If a new person becomes entitled to possession either during, or after, the three (or six) month period, a further ‘free' period cannot be granted.
If you are being charged Empty Rates and your think that your property is not capable of beneficial occupation - for instance, if it is in very poor condition and cannot be economically repaired or, is undergoing major renovation works which render the property incapable of occupation - the District Valuer may remove it from the Local Rating List. It is your responsibility to approach the Valuation Office Agency and request that the property be removed from the Rating List. (See Frequently Asked Questions). In the meantime, while the property remains in the Local Rating List the Rates are due and payable.
Please note that it is not possible to claim Small Business Rate Relief against empty properties.
Relief on newly-built empty property
The government has introduced a temporary scheme to encourage local authorities to provide rate relief on certain newly-built empty properties for up to 18 months after they are completed. Under this scheme local authorities can provide up to 100 per cent relief from business rates. This scheme for new properties works alongside the exemption already allowed on empty properties for the first three months that they are empty (or the first six months for industrial property).
What kind of property qualifies for newly-built empty property relief?
The property must:
- be unoccupied non-domestic property and
- be wholly or mainly made of a new structure (structure means foundations and/or permanent walls and/or permanent roofs) and
- be completed after 1 October 2013 and before 30 September 2016 and
- have been completed in the 18 months immediately before the ratepayer applies for this relief.
Newly-built empty property relief:
- goes with the property, so the benefit of any period of relief that is left when the property is sold can be passed on to a new owner.
- lasts for the 18 months after completion, even when empty periods are split by periods of occupation.
- can also apply to properties that are newly created following splits, mergers or changes to pre-existing properties, as long as the new property fits the qualifying rules above.
- can be awarded within Enterprise Zones (EZ) where EZ relief has not been allowed for a property or it has ended.
- is 100 per cent of the business rates, but as it counts as state aid it can only be awarded up to the state aid limit (currently 200,000 Euros altogether in any three-year period).