When it comes to owning commercial property, there are many expenses that need to be taken into consideration. One of the most important expenses that property owners need to be aware of is the rates payable on empty commercial property. These rates can significantly impact the profitability of owning commercial property, so it is crucial for property owners to understand how they are calculated and what options are available to minimize the cost.
rates payable on empty commercial property are essentially the taxes that property owners need to pay to the local council when their property is unoccupied. These rates are designed to encourage property owners to keep their properties occupied, as empty properties can have a negative impact on the surrounding area and the local economy.
The amount of rates payable on empty commercial property is calculated based on the rateable value of the property. The rateable value is determined by the Valuation Office Agency (VOA) and is based on the rental value of the property. The local council then applies a multiplier, known as the uniform business rate (UBR), to the rateable value to calculate the rates payable.
Property owners are typically required to pay 100% of the rates payable on empty commercial property for the first three months that the property is unoccupied. After the first three months, the rates payable are usually reduced to 50% for properties with a rateable value of over £2,900. However, it is important to note that each local council has the authority to set their own rules and regulations regarding rates payable on empty commercial property, so it is essential for property owners to check with their local council for specific information.
There are several options available to property owners to reduce the amount of rates payable on empty commercial property. One option is to apply for relief or exemptions from the local council. There are various types of relief available, such as hardship relief, charitable relief, and small business rate relief, which can help property owners reduce the cost of rates payable on empty commercial property.
Another option is to consider leasing the property on a short-term basis to a temporary tenant. By doing so, property owners can avoid paying the full rates on the property while still generating some income. This can be a viable option for property owners who are struggling to find a long-term tenant for their property.
Property owners can also consider investing in their property to make it more attractive to potential tenants. By improving the property and making it more desirable, property owners can increase their chances of finding a tenant quickly, which can help reduce the amount of time that the property is unoccupied and therefore the rates payable on empty commercial property.
In some cases, property owners may also be able to negotiate with the local council to come to a payment plan or arrangement for the rates payable on empty commercial property. This can be particularly helpful for property owners who are experiencing financial difficulties and need some flexibility in paying their rates.
Overall, rates payable on empty commercial property can be a significant expense for property owners, but there are options available to help reduce the cost. By understanding how rates are calculated and exploring the various relief options and strategies for reducing rates payable, property owners can effectively manage this expense and make owning commercial property more profitable.