Important changes to business rates
The Government announced in the 2007 budget that they intend to reduce the amount of relief awarded to empty non domestic property. These changes take effect from the 1 April 2008.
The changes apply to all business premises in England.
What has changed?
The major changes are:
- The empty property rate will increase from 50% to 100% of the occupied rate from 1 April 2008.
- Industrial properties will cease to be exempt from empty property rates and will have to pay the full empty property rate.
- Empty properties owned by charities or community amateur sports clubs will not be subject to empty rates.
Are there any exemptions?
The following exemptions from empty property rates will apply:
- Properties which been unoccupied for a continuous period not exceeding three months, except for industrial properties where the period of exemption is six months;
- Properties whose owner is prohibited by law from occupying it or allowing it to be occupied;
- Properties 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 the occupation of the property or to acquiring it;
- Properties whose rateable value is less than £2,200; increased to £15,000 from the 1st April 2009; increased to £18000from 1st April 2010;
- Listed buildings and ancient monuments
- Properties under the control of the personal representative of a deceased person;
- Properties whose owner is subject to a bankruptcy order within the meaning of section 381(2) of the Insolvency Act 1986
- Properties whose owner is a company which is subject to a winding-up order, a company in administration, or in liquidation.
What if my property is in a poor condition and/or not capable of beneficial occupation?
If your property is not capable of beneficial occupation – for instance, if it is in poor condition and can not be economically repaired or, is undergoing major renovation works which render the property incapable of occupation – you must approach the Valuation Office and request that the property be removed from the rating list altogether. In the meantime whilst the property remains in the local rating list the non domestic rates are due and payable.
Can I appeal against the changes in my rate liability?
The changes in rates liability arising from the reforms to empty property relief are not in themselves grounds for appeal. However, if you disagree with the rateable value that appears in the current local rating list or that the property appears in the local rating list at all, under existing arrangements you may challenge it by making a ‘proposal’ to the Valuation Officer. Further advice on making such a proposal can be obtained on the Valuation Office website, by telephoning 0113 3884500, or by writing to The Valuation Office Agency, Eastgate House 42 Eastgate Leeds LS2 7JL.