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Empty property rates

Empty property rates

Changes to the rates liability of empty and partly occupied properties

The government reformed empty property relief in 2008 in order to provide a strong incentive to bring empty property back into use. This change was intended to help to increase the supply of premises to let and reduce business rents. It was designed also to bring forward brownfield sites for re-development and reduce the need for new development on environmentally valuable greenfield land. The reforms to empty property relief had consequential impacts for the rates liability of apportioned partly occupied properties.

So what does this mean for my rates liability?
Most property that has been empty for more than three months, or in the case of industrial property, for more than six months, receives no relief from rates.
After the initial three or six month rate-free period expires, empty property is liable for 100% of the basic occupied business rate using the higher rates multiplier, unless it:
- Qualifies for the  zero rate provided by the Rating (Empty Properties) Act 2007. From 1 April 2008, the rates liability of empty property that is held by a charity and appears likely to be next used for charitable purposes, or that is held by a community amateur sports club and appears likely to be next used for the purposes of the club, is reduced from 10% of the basic occupied rate to zero.
- Qualifies for an exemption from rates under the NNDR (Unoccupied Property) Regulations. While the previous permanent exemption for industrial property is reduced to six months, the majority of the other existing exemptions remain unchanged.
- For 2009/10 only, no rates are payable on empty properties with a rateable value of less than £15000.
- For 2010/11 only, no rates are payable on empty properties with a rateable value of less than £18000.

-From 1 April 2011 onwards, no rates are payable on empty properties with a rateable value of less than £2600.

 

 

Can I get my property taken out of the rating list altogether?

If your property is not capable of beneficial occupation - for instance, if it is in poor condition and cannot be economically repaired - the Valuation Officer may judge that it should be taken out of the rating list altogether. However, the government may introduce measures to prevent ratepayers avoiding rates by deliberately damaging property, if this is seen to be a problem

How is my rates liability be affected if my property is only partly occupied?

If a property is only partly occupied, the billing authority has discretion to request that the valuation officer apportions the property's rateable value between its occupied and unoccupied parts.
Previously,broadly speaking, the empty property rate applies to the empty part of an apportioned building and the occupied business rate applies to the occupied part. From 1 April 2008, the empty part will only receive a complete exemption from rates for the first three months it is empty (or, if it is an industrial property, for the first six months).
After the initial rate-free period expires, in most cases the apportionment ceases to have effect and the occupied business rate applies to the whole property. This ensures that occupiers can benefit from any occupied business rate reliefs to which they are eligible - such as small business rate relief - on the whole of the property, not just the occupied part. If the property would qualify for the new zero rate or for an exemption from rates when empty, the apportionment continues to have effect and the owner will not be liable for rates on the empty part.

Can I appeal against the change in my rates liability?

If you disagree with the rateable value that appears in the current rating list entry for your property, under the existing arrangements you may challenge it by making a `proposal' against it to your local valuation office. You can contact this authority or the local valuation office for further information about the arrangements for making proposals."

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