How to recover business rates on empty properties

Since 1990, when they were introduced, business rates have represented substantial part of costs that weigh on every business activity, and they’ve been very used by the Government, being a “non-distortionary” tax. A big issue is represented by empty business property, left vacant for some period, on which companies don’t have to pay rates only on certain strict conditions.

If business rates on non-residential buildings are pretty onerous at the moment, with the British Retail Consortium (BRC) strongly asking for reform, these taxes are expecting to rise in the next years, with a revenue for the government estimated to go up from £29bn to more of £31bn in 2020-21.

For these reasons companies are now trying to rationalise their workspaces, reducing their vacant properties. A lot of them still have many empty buildings that are waiting for renovation, new instalments or just council permissions. Empty non-residential properties get a relief from business taxes for a continuous period of three months, industrial and warehouse buildings for six months, but after this owners have to pay high rates on these unproductive sites.

There are many ways to avoid these rates. Firstly when the council declare uninhabitable the property, but this means that the building can’t be quickly reoccupied without any renovation. A permanent decision could be demolition or sale, but the second one could require also a long period of time, during which the owner is still paying for his property.

A generous solution could be leasing their building to charities organisations, which are exempted by taxes due to their nature. This could help companies saving a lot of money and getting a better image to their customers.

A good method for owners to recover their rates, payments is renting their property for short periods to tenants or licensees. If the building is occupied for more than six weeks, the owner will be able to get a new exemption for three months, preventing the risk of temporary letting to gain additional free rates period.

Ad Hoc Property can help companies to find people, Property Guardians, to occupy their vacant properties, recovering a major part of business rates. Property Guardians will not only occupy these sites, paying rents, but they will also prevent the risk of any unauthorised access and intromission, protecting buildings from thieves, squatters and vandals.

With Ad Hoc Property’s services, owners can recover part of the business rates that weigh on their empty properties, while Property Guardians look after these buildings, saving up to 80% compared to traditional security systems.

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