Landlords who own commercial properties in the UK are no strangers to business rates – a tax levied on most non-domestic properties. However, there are ways for landlords to seek relief from these taxes through various schemes offered by the government. In this article, we will delve into the intricacies of landlord business rates relief and how it can benefit property owners.
What is Business Rates Relief?
Business rates relief is a form of tax relief offered to business owners, including landlords, to help reduce the burden of paying business rates. The relief is meant to support small businesses, stimulate economic growth, and revitalise local communities. There are several types of business rates relief available, each with its own eligibility criteria and application process.
Types of Business Rates Relief for Landlords
1. Small Business Rate Relief (SBRR)
Small Business Rate Relief is aimed at businesses occupying a property with a rateable value below a certain threshold. For landlords, this relief can be claimed if the property is either unoccupied or occupied by a small business. The amount of relief varies depending on the rateable value of the property, with properties valued under £15,000 receiving the full relief and properties valued between £15,000 and £51,000 receiving tapered relief.
2. Mandatory Charitable Rate Relief
Landlords who own properties that are occupied by registered charities are eligible for Charitable Rate Relief. This relief can cover up to 80% of the business rates bill, with local authorities having the discretion to grant additional relief on the remaining 20%.
3. Transitional Rate Relief
Transitional Rate Relief is designed to help landlords cope with significant increases in their business rates bills following a revaluation of their property. The relief is only available for a limited period and gradually reduces over time as the rates become aligned with the new rateable value of the property.
4. Empty Property Relief
Landlords who own unoccupied commercial properties can apply for Empty Property Relief to reduce or exempt their business rates bill. The relief is granted for a specified period, after which the rates are reinstated based on the rateable value of the property.
5. Discretionary Rate Relief
In some cases, local authorities may offer discretionary rate relief to landlords facing financial hardship or exceptional circumstances. The relief is granted on a case-by-case basis and may involve a combination of relief schemes tailored to the landlord’s specific needs.
How to Apply for Business Rates Relief
To apply for business rates relief as a landlord, you will need to contact your local council and provide them with the necessary information about your property. The council will review your application and determine your eligibility based on the criteria of the relevant relief scheme. It is important to keep accurate records of your property’s occupancy status, rateable value, and any other relevant details to support your application.
Benefits of landlord business rates relief
There are several benefits to seeking business rates relief as a landlord. By reducing the amount of tax you have to pay, you can save money on your property expenses and increase your rental income. Additionally, business rates relief can make your property more attractive to tenants, as they will have lower occupancy costs and may be more inclined to lease the property for a longer period.
In conclusion, landlord business rates relief offers a valuable opportunity for property owners to reduce their tax liabilities and enhance the financial viability of their investments. By exploring the various relief schemes available and working closely with local authorities, landlords can take advantage of these benefits and optimise their property management strategies. Whether you own a small business or a large commercial property, it is important to stay informed about business rates relief and leverage it to your advantage as a landlord.