When it comes to running a business, there are many expenses that can eat into your profits. One of the most frustrating costs that business owners have to contend with is business rates. These rates are charged on most non-domestic properties, including shops, offices, and warehouses. Business rates are calculated based on the rateable value of the property and can vary depending on a number of factors. However, what many business owners may not realize is that they may still be liable for business rates even if their property is empty or unused. This is known as void business rates.
void business rates are a cost that many businesses may not even be aware of until they find themselves in the situation where their property is empty. When a business property becomes empty, the owner is often left wondering whether they still have to pay business rates on that property. The short answer is yes, in most cases, business owners are still liable for business rates on empty properties. This is because the property is still deemed to have a rateable value, which is used to calculate the amount of business rates owed.
The rationale behind void business rates is to discourage property owners from leaving their properties empty for extended periods of time. The government wants to incentivize property owners to keep their properties in use and maintain a vibrant business environment. By charging business rates on empty properties, the government hopes to discourage property owners from leaving their properties vacant for long periods of time.
Business owners who find themselves with empty properties may be wondering what they can do to mitigate the cost of void business rates. One option is to apply for an exemption or relief on their business rates. There are certain circumstances in which business owners may be eligible for relief on their business rates, such as if the property is undergoing renovation or is in need of repair. Business owners should contact their local council to find out if they are eligible for any exemptions or relief on their business rates.
Another option for business owners facing void business rates is to consider renting out the property on a short-term basis. By leasing the property to another business temporarily, the owner can avoid having to pay void business rates while still generating some income from the property. This can be a win-win situation for both parties, as the owner avoids the cost of void business rates while the temporary tenant gets a space to operate their business. However, it is important for business owners to carefully consider the terms of any short-term lease agreements to ensure that they are still meeting their obligations as property owners.
Business owners should also keep in mind that there are certain exemptions for void business rates. For example, properties with a rateable value of less than £2,900 are exempt from paying business rates on empty properties. This exemption is intended to provide some relief to small businesses that may be struggling to keep their properties occupied. Additionally, properties that are empty for a short period of time may also be eligible for a temporary exemption from void business rates. Business owners should check with their local council to find out if they qualify for any of these exemptions.
In conclusion, void business rates can be a significant cost for business owners with empty properties. It is important for business owners to be aware of their obligations when it comes to void business rates and to explore all possible options for mitigating this cost. By seeking exemptions or relief, considering short-term leasing options, and staying informed about their rights and responsibilities, business owners can better navigate the complexities of void business rates and minimize the impact on their bottom line.