Business rates are a tax that businesses in the UK have to pay on any property that is empty or unoccupied for more than 28 days in a year. This can be quite an expensive tax to pay, so it’s important to know how to avoid paying them. In this article, we’ll show you four ways to avoid paying business rates on your empty property.
What are business rates?
Business rates are a tax charged on the use of property which is not occupied by a business. They are calculated as a percentage of the property’s assessed value. In England and Wales, business rates are paid on vacant properties and on properties used for commercial purposes other than agriculture. Properties used for agriculture are exempt from paying business rates. There are three main ways to avoid paying business rates:
- Use the exemption certificate scheme – If you own a property that is not being used for commercial purposes, you can apply for an exemption certificate from your local council. This will allow you to continue to pay business rates on the property, even if it is vacant. You must apply for an exemption certificate before you start any work on the property.
- Use the relief scheme – If you use a property commercially but it is empty for more than 12 months out of the year, you can apply for relief from paying business rates. You must prove that the property is used for a commercial property purpose and is not being let out to tenants or used for other commercial purposes.
- Use the Section 106 agreement – If you use a property commercially but it is empty for more than 6 months out of the year,
How do I calculate the rates on my property?
One of the most common questions property owners ask is how to calculate business rates on their empty property. The calculation can be a little confusing, but we’ve outlined the process below.
The first step is to work out your annual rental value. This will be based on the market rate for the area and the type of property you’re renting out. You can use rental properties online or find an estimator in your area.
Once you have your annual rental value, you need to determine the taxable value of your property. This is based on its market value and the amount of time it has been vacant (usually two years). Finally, add these two values together to get your total business rates bill.
What can I do to avoid paying business rates?
There are a few things that you can do to avoid paying business rates on an empty property. Firstly, make sure that you have the property re-zoned to allow for commercial use.
Secondly, make sure that you have obtained all the necessary permits and licenses from the relevant authorities. Finally, make sure that you have taken all necessary precautions to ensure that the property is properly maintained and protected from fire and other hazards.
How to avoid business rates on empty property?
Business rates are a tax that businesses have to pay on their property. If you’re thinking of selling your property and don’t want to pay business rates, there are a few things you can do.
Firstly, make sure your property is actually empty – if it’s only partly empty, you may have to pay business rates on the part that’s occupied.
Secondly, check whether your property falls within one of the exemptions listed in the Business Rates Act 1995. Some exemptions include commercial premises used for residential purposes, derelict or abandoned premises, and certain types of agricultural land.
If your property doesn’t fall within one of these exemptions, you may still be able to avoid paying business rates by applying for a relief certificate. A relief certificate will allow you to pay less than full business rates for your property, based on its estimated value. You can apply for a relief certificate from your local council.
Conclusion
As an entrepreneur, you know that the cost of starting a business is one of the most important factors to consider. Unfortunately, there are also a number of costs associated with running a business, such as business rates.
If you’re thinking of starting up your own business but don’t have any vacant property to call your own, don’t worry there are plenty of ways to avoid paying these high rates. By taking some simple steps and asking around for advice from experienced entrepreneurs, you can ensure that you start up your new business without breaking the bank.