Understanding Void Business Rates: What You Need To Know

When it comes to running a business, there are many costs that have to be taken into consideration. From rent and utilities to salaries and marketing expenses, the list goes on and on. However, one cost that often gets overlooked until it becomes a problem is void business rates.

void business rates, also known as empty property rates, are a tax that commercial property owners have to pay on properties that are unoccupied. These rates were introduced by the government to encourage property owners to either rent out their vacant properties or sell them. The idea behind void business rates is to prevent properties from sitting empty for extended periods of time, as this can have a negative impact on the local economy.

Business rates are typically based on the rateable value of a property, which is determined by the Valuation Office Agency. When a property becomes vacant, the owner is usually entitled to a period of relief – usually three months for industrial and warehouse properties and six months for all other properties. After this period, void business rates will be due unless the property qualifies for certain exemptions.

For small business owners who may be struggling to keep their heads above water, void business rates can be a significant financial burden. Not only are they still responsible for paying the rates on their empty properties, but they also have to cover the costs of maintaining the property and keeping it secure. This can quickly add up and put additional strain on an already struggling business.

One of the main challenges with void business rates is that they can deter property owners from investing in or developing their properties. If an owner knows that they will be hit with hefty rates as soon as their property becomes vacant, they may be less inclined to make improvements or seek out new tenants. This can lead to a cycle of disinvestment and decline in an area, ultimately hurting the local economy.

There are some exemptions and reliefs available for certain types of properties when it comes to void business rates. For example, properties with a rateable value of less than £2,900 are exempt from paying void business rates. Additionally, charities and community amateur sports clubs are entitled to an 80% discount on void business rates for properties that are used for charitable purposes.

However, even with these exemptions and reliefs, void business rates can still be a significant financial burden for property owners. This is especially true for larger commercial properties or for owners who have multiple vacant properties in their portfolio. In some cases, void business rates can even lead property owners to consider demolishing their properties rather than paying the rates on them.

So, what can be done to alleviate the burden of void business rates for property owners? One possible solution is for the government to provide more support and incentives for property owners to bring their vacant properties back into use. This could include offering grants or tax breaks for property owners who renovate their properties or find new tenants within a certain timeframe.

Local authorities could also play a role in helping property owners with void business rates. By working with property owners to find creative solutions for their vacant properties, such as converting them into affordable housing or community spaces, local authorities can help to revitalize areas and stimulate economic growth.

Ultimately, void business rates are a complex issue that requires careful consideration and collaboration between property owners, government agencies, and local authorities. By working together to find innovative solutions and provide support to property owners, we can help to alleviate the burden of void business rates and create vibrant, thriving communities.