Empty Business Property

Changes to the rates liability of empty properties to take effect from 1 April 2008

The Government has reformed empty property relief in order to provide a strong incentive to bring empty property back into use. This will help to bring empty property back into use, also help to increase the supply of premises to let, and so reduce business rents and improve the competitiveness of the UK, as well as bringing forward brownfield sites for re-development, and so reduce the need for new development on Greenfield land. These changes also impact on the rates liability of partly occupied properties.

So what will this mean for my rates liability?

As of 1 April 2008, most property that has been empty for more than three months – or, in the case of industrial property, for more than six months – will no longer receive relief from rates. After the initial three or six month rate free period expires, empty property will be liable for 100% of the basic occupied business rate, unless it:

It is held by a charity and appears likely to be next used for charitable purposes.
It is held by a community amateur sports club and appears to be next used for the purpose of the club.
The rateable value of the property is less than £2200
The owner is prohibited by law from occupying the property.
The owner is prohibited by action taken by the Crown, or any other local or public authority from occupying the premises.
The property is included in the schedule of monuments compiled under s.1 to the Ancient Monuments and Archaeological Areas Act 1979.
The owner is entitled to possession only in his capacity as the personal representative of a deceased person.
If the following insolvency or debt administration situation exists:
A bankruptcy order within parts 8 to 11 of the Insolvency Act 1986.
The owner is a trustee under a deed of arrangement to which the Deeds of Arrangement Act 1914 applies.
The owner is a company subject to a winding up order made under the Insolvency Act 1986.
The owner is entitled to possession of the property in his capacity as liquidator under s112 or s145 of the Insolvency Act 1986.
It is a listed building

Can I appeal against the change in my rates liability?

The changes in rates liability arising from the reforms to empty property relief are not themselves grounds for appeal. However if you disagree with the rateable value that appears in the current rating list entry for your property, under the existing arrangements you may challenge it by making an appeal against it to your local valuation office. Further information on the grounds for making an appeal, and on how to make one can be found on the VOA website at www.voa.gov.uk or from your local valuation office, whose address is: Stockport Valuation Office, Beckwith House, 1 Wellington Road, North, Stockport, SK4 1AH. Telephone 0161 252 7900, Email: manchestergroup.vo@voa.gsi.gov.uk

Can I get my property taken out of the rating list altogether?

If your property is not capable of beneficial occupation – for instance, if is in poor condition and cannot be economically repaired – your valuation officer may judge that it should be taken out of the rating list altogether. However, please be aware that if the state of your property is damaged for the purposes of avoiding rates, under the new anti-avoidance legislation introduced by Government you valuation officer will be required to disregard the change in the property’s state when assessing its rateable value. So for instance if the roof is removed from an empty property for the purpose of avoiding rates, it may be valued as if the roof had not been removed.

How will my rates liability be affected if my property is only partly occupied?

If a property is only partly occupied, for a temporary period, the billing authority has discretion to request that the valuation officer apportions the property’s rateable value between it’s occupied and unoccupied parts. There would then be an exemption applied to the empty portion for the first 3 months of the empty period, (or if industrial for the first 6 months). If you require further details about this new legislation please contact the Business Rates Section on 0161 770 6677 between 8.40 am and 5.00 pm Monday to Friday.