(Please note that the regulations regarding the rating of
unoccupied properties was amended from 1 April 2008 .The
information provided below is based on those changes)
Who has to pay Empty Rates?
In accordance with the provisions of section 45 of the Local
Government Finance Act 1988 as amended by the Non Domestic Rating
(Unoccupied Property)(England) Regulations 2008, the owner (i.e.
the person entitled to possession) of an unoccupied non-domestic
property is liable to pay 100% of the basic occupied business rate.
Rates will not be payable for the first three months that a
property is empty. This period will be extended to six months for
qualifying industrial properties.
What is a 'Qualifying Industrial
The regulations define a ‘qualifying industrial hereditament’ as
any hereditament other than a retail hereditament in relation to
which all buildings comprised in the hereditament are-
(a) constructed or adapted for use in the course of a trade or
(b) constructed or adapted for use for one or more purposes
(i) the manufacture, repair, or adaptation of goods or materials,
or the subjection of goods or materials to any process;
(ii) storage (including the storage or handling of goods in the
course of their distribution);
(iii) the working or processing of materials;
(iv) the generation of electricity;
and ‘retail hereditament’ means any hereditament where any
building or part of a building comprised the hereditament is
constructed or adapted for the purpose of the retail provision
(a) goods, or
(b) services, other than storage for distribution services, on or
from the hereditament.
How much is the Empty Rate?
100% of the basic occupied business rates will
be payable on all relevant non domestic hereditaments unless they
fall within one of the categories defined within paragraph 4 of the
Non Domestic Rating (Unoccupied Property)(England) Regulations 2008
(as amended by The Non-Domestic Rating (Unoccupied Property)
(England) Regulations 2009). These categories are shown below.
What Exemptions are there from Empty Rates?
Any hereditament which falls within one of the following
categories will be exempt from empty rates
- whose owner is prohibited by law from
occupying it or allowing it to be occupied
- which is 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
- which is the subject of a building
preservation notice within the meaning of the Planning (Listed
Buildings & Conservation Areas) Act 1990 or is included in a
list complied under section 1 of that Act;
- which is included in the Schedule of
monuments compiled under Section 1 of the Ancient Monuments and
Archaeological Areas Act 1979;
- whose rateable value is less than £2,600 -
for the financial year 2009/10 this was amended to a rateable value
less than £15,000 and for the year 2010/2011 it was extended
to a rateable value less than £18,000.
- whose owner is entitled to possession only
in his capacity as the personal representative of a deceased
- where, in respect of the owner’s estate,
there subsists a bankruptcy order within the meaning of 381(2) of
the Insolvency Act 1986;
- whose owner is entitled to possession of
the hereditament in his capacity as trustee under a deed of
arrangement to which the Deeds of Arrangement Act 1914
- whose owner is a company which is subject
to a winding-up order made under the Insolvency Act 1986 or which
is being wound up voluntary under that Act;
- whose owner is a company in administration
within the meaning of paragraph 1 of schedule B1 to the Insolvency
Act 1986 or is subject to an administration order made under the
former administration provisions within the meaning of article 3 of
the Enterprise Act 2002 (Commencement No.4 and Transitional
Provisions and Savings) Order 2003
- whose owner is entitled to possession of
the hereditament in his capacity as liquidator by virtue of an
order made under Section 112 or Section 145 of the Insolvency Act
A ‘relevant non domestic hereditament’ means any non domestic
hereditament consisting of, or of part of, any building, together
with any land ordinarily used or intended for use for the purposes
of the building or part.
A hereditament which has been unoccupied and becomes occupied on
any day shall be treated as having been continuously unoccupied,
for the purposes of a three or six month exemption period, if it
becomes unoccupied again on the expiration of a period of less than
six weeks beginning with that day.
Empty properties held by a charity or Community Amateur Sports
Club may qualify for the new zero rate provided by the Rating
(Empty Properties) Act 2007.