Reducing the cost of vacant property
Empty business property is expensive. Leave it empty for too long, and the billing authority will charge you full business rates. It’s all due to the Empty Rates legislation. However, there is an answer: our GN Empty Rates service, which could bring savings of over 65% to your business.
Since April 2008, properties are exempt from business rates for three months from the date they become empty. Industrial properties are exempt for six months. Following these exemption periods, businesses must pay full business rates.
How the service can help
The key cases to date are as follows:-
- Makro Properties Ltd v Nuneaton and Bedworth District Council 2012
Confirmed that there is no de minimus rule to be applied to the occupation but the occupation must be beneficial
- Preston City Council v Oyster Angel Charity 2012
Confirmed that when next in use by a charity for charitable purposes means when next in use by any charity and does not require re-occupation by the same charity
- Public Safety Charitable Trust v Milton Keynes Council and others 2013
Confirmed that the use of Bluetooth transmission broadcasting charitable messages did not constitute on the facts that the premises were occupied wholly or mainly for charitable purposes
- Sunderland City Council v Stirling Investment Properties LLP 2013
Confirmed that Bluetooth transmission did on the facts constitute rateable occupation
- Keith Newbigin (VOA) v S J & J Monk 2015
Overturned The Upper Chambers decision and confirmed that where premises were undergoing re-construction the economic repair test requires the essential services and other building elements to be in situ. In other words their replacement (following removal) falls within the definition of repair, and the premises could not be valued on the assumption that the premises were devoid of such facilities.
- Pall Mall Investments (London) Ltd v Gloucester City Council 2014
Confirmed that the meaning of occupation being ‘prohibited in law’ did not include buildings that were in a poor state of repair and where occupation would be in breach of current Health & Safety standards
So what options remain to mitigate business rates charges on empty buildings in dis-repair?
Some question marks arise following the Pall Mall cases, on whether the presence of asbestos is sufficient to gain the advantage that occupation of the property is prohibited in law. Soft stripping is still an option to seek a £0 Rateable Value, but careful advice is now required following S J & J Monk that the estimated costs of repair fall outside of the economic repair test. For buildings in poor repair advice is again required to advise on the likely costs of bring the building back into repair.
GN can provide such advice or alternatively discuss empty rates mitigation through deployment of 6 week occupation schemes to create new void periods.