What if a Property is Empty?

Introduction

Since 1st April 1990 the rating of unoccupied property has been mandatory. The Council no longer has discretion to either vary the percentage of unoccupied property rates or to exclude property in any special category.

A property becomes liable for unoccupied property rates when all of the following conditions are fulfilled:

• The whole property is unoccupied (all stock and equipment must be removed to qualify)
• The ratepayer is entitled to occupy the whole property
• The property is not exempt from empty property rates by law
• The property is shown in the local rating list

Rates are charged at 50% of the full rate bill or of the transitional bill where the transitional arrangements apply. Liability begins after the property has been empty for three months.

Where part of a property is unoccupied for a short time, the Council can ask the Valuation Officer to apportion the Rateable Value of the property between the occupied and unoccupied parts. The rates are then calculated having regard to the reduced liability for the property. If you wish to apply for part unoccupied rates please send a plan of the property marking the unoccupied area to the Non-Domestic Rates (Business Rates) Section.

Exemptions from unoccupied property rates

A property is exempt from unoccupied property rates if any of the following apply:

Small Properties

Properties with a rateable value of less than £1,900 are exempt from unoccupied property rates.

Property Unoccupied for less than three months

• A property is exempt from unoccupied property rates if it has been continuously unoccupied for a period of less than three months. In determining whether a property has been continuously unoccupied for three months, any period of occupation of less than six weeks is disregarded.
• At the end of the three month exempt period empty rates will be paid at 50% (half the charge).

Occupation prohibited by law

A property is exempt from unoccupied property rates if the owner is prohibited by law from occupying it or allowing it to be used.

Action by the Crown or Local Authority

A property is exempt from unoccupied property rates if it is vacant due to action taken by the Crown or the local authority with a view to prohibiting the use or acquiring it.

Listed buildings

A property is exempt from unoccupied property rates if the whole of it is under a building preservation notice or it is a listed building or it is an ancient monument.

Industrial properties

A property is exempt from unoccupied property rates where it is accepted by the Valuation Officer as being constructed or adapted for use as a business and where it was used for one or more of the following purposes:

• The manufacture, repair, adaption or processing of goods or materials
• Storage (including the storage or handling of goods in the course of their distribution)
• The working or processing of minerals
• The generation of electricity

A property normally qualifies for exemption even if one or more of the buildings is not used for manufacturing or storage purposes. For example, almost all factories and workshops contain offices, or office blocks, which are ancillary to the main purpose of the business.

Possession only as a Personal Representative, Liquidator etc.

A property is exempt from unoccupied property rates if the person who holds it only does so as a personal representative of a deceased person, or as a liquidator.

Completion notices for new buildings

The purpose of a completion notice is to establish the date from which the building is to be treated as completed for the purpose of unoccupied property rating.

In general the construction of a building will proceed to the point where it is capable of being occupied, but sometimes the owner will substantially complete it, but not to the point where it is completely capable of occupation, until a tenant can be found. In these circumstances the service of a completion notice by the Council ensures that liability of unoccupied property rates is not avoided.

The law requires the Council to issue a completion notice for a newly erected building as soon as it comes to our attention that the work remaining to be done can reasonably be expected to be completed within three months. A completion notice may be served on the whole of a building or part of a building.

The completion notice will show the date on which the Council considers the building could reasonably be completed. The purpose of a completion notice is to establish the date from which a new or altered building is to be treated as unoccupied for the purpose of unoccupied rates. It does not establish the date from which liability to pay empty property rates starts, it serves to establish the day from which the three-month period of exemption starts.

If you do not agree with the completion date you should write to the Council immediately. We will try to come to an agreement with you about the date of completion, but if agreement cannot be reached you may appeal to the local Valuation Tribunal. We will give details of how to appeal if there is a dispute.

If you have any questions about this information, please contact the Non-Domestic Rates (Business Rates) Section on 01263 516110.