Unoccupied property rating
From 1 April 2008, in most cases, owners or leaseholders of empty properties will be liable to pay 100% business rates charge after the first three months of the property becoming completely empty.
However, owners of qualifying industrial properties will be liable to pay a charge of 100% after being empty for six months.
Owners of empty properties who are a charity will not be liable for a charge if the property when next in use will be wholly or mainly used for charitable purposes. Similar provisions apply to empty properties owned by Community Amateur Sports Clubs.
VOA advice in respect of those affected by the changes to the empty property rates
- All non domestic property has to be rated for business rates purposes regardless of whether it is occupied or not.
- The rateable value represents the rental value at 1 April 2008 and is the basis for business rates bills supplied by the council. Ratepayers can check the details used to work out the rateable value on the Business Link website.
- If any of those details do not look right, or if there is evidence to suggest the rateable value does not represent rental value at 1 April 2008, the ratepayer should contact the VOA on 03000 505 505.
- Ratepayers are advised not to make formal appeals because the VOA is unable to change the rateable value of any property simply because the rateable value level at which Empty Property Rate is charged has been reduced from £18,000 to £2,600 from 1st April 2011.
Legislation for 2009/2010 only
For one year only, from 1 April 2009 to 31 March 2010, no business rates are payable on any empty business property with a rateable value of up to £15,000. This temporary change replaced the previous limit of up to £2,200 rateable value.
For the above period only, properties with a rateable value of £15,000 or more will receive empty property relief for the first three months for which the property is empty, or in the case of industrial property, the first six months.
Legislation for 2010/2011 only
For one year only, from 1 April 2010 to 31 March 2011, no business rates are payable on any empty business property with a rateable value of up to £18,000. This temporary change replaced the previous temporary limit of up to £15,000 rateable value.
For the above period only, properties with a rateable value of £18,000 or more will receive empty property relief for the first three months for which the property is empty, or in the case of industrial property, the first six months.
Legislation for 2011/2012 onwards
From 1 April 2011, no business rates are payable on any empty business property with a rateable value of up to £2,600. This change reduced the previous temporary limit of up to £18,000 rateable value and so empty business property with a rateable between £2,600 and £17,999 are now subject to empty property rates.
Properties with a rateable value of £2,600 or more will receive an empty property exemption for the first three months for which the property is empty, or in the case of industrial property, the first six months (this period can be before 1 April 2011). However, once a business property has been empty for longer than the initial three or six month period (as appropriate) owners or leaseholders of empty properties will, in most cases, be liable to pay 100% business rates charge.
Exemptions to unoccupied property rate
Legislation provides that, should any of the following conditions apply to the empty property or the owner/leaseholder, an exemption will apply so that unoccupied property rates will not be payable.
- The property has been unoccupied for a period not exceeding three months; The property is a qualifying industrial property, which has been unoccupied for a period not exceeding six months;
- The owner is prohibited by law from occupying the property or allowing it to be occupied;
- The property is kept vacant by reason of action taken by or on behalf of the Crown or any local or public authority with a view to prohibiting occupation or to acquiring the property;
- The property is the subject of a building preservation notice within the meaning of the Planning (Listed Buildings and Conservation Areas) Act 1990 or is included in a list compiled under Section 1 of the Act;
- The property is included in the Schedule of Monuments compiled under Section 1 of the Ancient Monuments and Archaeological Areas Act 1979;
- The rateable value of the property is less than £2,600;
- The owner is entitled to possession of the property only in his capacity as the personal representative of a deceased person;
- The owner's estate is subject to a bankruptcy order within the meaning of Section 381 (2) of the Insolvency Act 1986;
- The owner is entitled to possession of the property in his capacity as trustee under the Deed of Arrangement Act 1914;
- The owner is a company which is subject to a winding-up order, made under the Insolvency Act 1986 or which is being wound up voluntarily under that Act;
- The owner is a company in administration within the meaning of Paragraph 1 of Schedule B1 to the Insolvency Act 1986 or is subject to an Administration Order made under the former administration provisions within the meaning of Article 3 of the Enterprise Act 2002 (Commencement No 4 and Transitional Provisions and Savings) Order 2003;
- The owner is entitled to possession of the property in his capacity as Liquidator by virtue of an order made under Section 112 or Section 145 of the Insolvency Act 1986
Partly occupied properties
Where a property is partly occupied for a short time, the council has the discretion in certain cases to award relief in respect of the unoccupied part. Partly occupied relief will require a site visit by one of our Inspector/Visiting Officers and a special certificate from the Valuation Office Agency. You will need to apply in writing with details and provide a scaled site plan of the premises to the Business Rates Team.
Please apply promptly as the local authority/Valuation Office Agency can only substantiate your claim whilst the part occupation is occurring. In certain circumstances, the unoccupied part will still be subject to an empty property rate charge. Please contact the Business Rates Team for further details on 01443 863006.