Understanding The Impact Of Business Rates On Empty Listed Buildings

When it comes to owning or managing a listed building, there are many factors that need to be taken into consideration. One such factor that often catches owners off guard is the business rates that are applied to empty listed buildings. In this article, we will delve into the complexities of business rates on empty listed buildings and explore why they are charged, how they are calculated, and what owners can do to minimize the impact.

Business rates are essentially a tax that is levied on non-domestic properties in the UK. This tax is used to fund local services and infrastructure and is charged by local authorities. Empty properties are not exempt from business rates, and this includes empty listed buildings. While there are some exemptions for specific types of properties, most empty listed buildings are subject to business rates.

Listed buildings are buildings that are deemed to have special architectural or historic interest. These buildings are protected by law, and any changes made to them must be carefully regulated to preserve their heritage value. However, owning a listed building comes with its own set of challenges, one of them being the business rates that are charged on empty properties.

The rationale behind charging business rates on empty listed buildings is to encourage owners to bring these buildings back into use. By imposing a financial penalty on owners who leave their properties empty, local authorities aim to incentivize owners to either rent out or sell their properties. This is seen as a way to revitalize areas and prevent historic buildings from falling into disrepair.

Calculating business rates on empty listed buildings can be a complex process. The rateable value of a property is used as a basis for calculating business rates, and this value is determined by the Valuation Office Agency (VOA). The rateable value takes into account various factors such as the size, location, and condition of the property. For listed buildings, the historic or architectural significance of the building can also impact its rateable value.

Once the rateable value is established, the actual business rates are calculated using a multiplier set by the government. This multiplier is reviewed annually and can vary depending on the location of the property. For empty properties, a different multiplier is applied, known as the empty property rates multiplier. This multiplier is higher than the standard multiplier and is designed to penalize owners for leaving their properties empty.

Owners of empty listed buildings may find themselves facing hefty business rates bills, especially if the property has a high rateable value. This can be a significant financial burden, particularly for owners who are already struggling to maintain the building or find a suitable use for it. In some cases, owners may even be forced to sell the property at a loss just to avoid paying the business rates.

So, what can owners of empty listed buildings do to minimize the impact of business rates? One option is to apply for an exemption or relief. There are certain types of relief available for empty properties, such as the listed building exemption. This exemption applies to listed buildings that are undergoing repair or restoration work and can provide owners with a temporary reprieve from paying the full business rates.

Owners can also explore other options such as leasing the property to a charity or community organization. In some cases, properties that are being used for charitable purposes may be eligible for relief or a reduction in business rates. Additionally, owners can consider applying for grants or funding to help cover the costs of bringing the building back into use.

In conclusion, business rates on empty listed buildings can be a significant financial burden for owners, but there are ways to mitigate the impact. By understanding why these rates are charged, how they are calculated, and what exemptions or reliefs are available, owners can make informed decisions about how to manage their properties. Ultimately, the goal is to preserve our heritage buildings while also ensuring that they contribute to the local economy and community.