Empty Property Exemptions

As of 1st April 2008 most properties that have been empty for more than 3 months (industrial property, 6 months) will no longer receive relief from rates. Therefore, after the 3 (or 6) month rate-free-period expires, empty properties will be liable for 100% of rates. The empty exemption is applied to the property as opposed to the liable party. Once the 3 or 6 month exemption has expired, if the property remains continuously empty there will be no further exemption regardless of any change of liability.

From 1st April 2010 the government decided to maintain a higher threshold on exempt empty properties.  All properties with a ratable value (RV) less than £18,000 will receive a full empty rate exemption.  This will only be applied once the initial 3 or 6 month exemption has expired (which may have happened on a previous account if the property has changed hands).

The business rates office has already identified cases which were receiving the under £15,000 exemption which expired on 31st Macrh 2010 or had reached the end of the time limited exemption (3 months for non-industrial or 6 months for industrial) with the new RV being below £18.000 and this would have shown on the annual bill.

Full indefinite exemptions while the property is empty

1. Owner prohibited by law from occupying.
   
2. Kept vacant due to action by crown, public or local authority.
3. Subject of a building preservation notice.
   
4. Ancient monuments.
   
5. Small hereditaments - this is when the Ratable Value is less than 2200.
   
6. Personal representatives, where an owner is entitled to possession only as a personal representative of a deceased person.
   
7. Bankruptcy - This applies when a bankruptcy order has been served on the owner.
   
8. Trustees - An owner will be exempt if he is trustee under a 'deed of arrangement'.
   
9. Companies being wound-up. When a company is wound-up, the exemption will apply from the date of the order. 
10. If the property is held by a charity or community amateur sports club (CASC), and is likely to be used for charitable or CASC purposes in the future.

Hardship relief criteria

The policy has recently been reviewed and the aims of the new policy are:

• To support genuine businesses suffering financial hardship;
• To promote access to relevant business support agencies;
• To provide assistance, where possible, to new businesses via our partnership with Business Link for London
• To target relief towards Small & Medium Enterprises (SMEs)
• To enable businesses to survive and ultimately contribute towards Harrow 's economy

Below are the key criteria for considering applications for business rate relief under Section 49 of the Local Government Finance Act 1988.

This policy was approved by Cabinet on 22nd October 2009

1. The rateable value of the property for which the application is being made must not be more than or £21,500 under the 1st April 2005 rating list or £25,499 under the 1st April 2010 rating list.
2. The applicant must have only one trading outlet in London Borough of Harrow.
3. The applicant must be in receipt of Small Business Rate Relief. 
4. The applicant must be trading from the property from which relief is being requested.
5. Applicants must have a business plan in place approved by either their bank or an approved business support agency.
6. Applicants must agree to undertake a business diagnostic from Harrow in Business or a supplier referred by Business Link of London. 

If the above are fulfilled, the application will consider:-

• If a refusal to grant relief would worsen employment in the area eg where a business employs local residents
• If a refusal would reduce the amenities of an area eg the loss of a unique business or perhaps a business serving a need in the community
• If the closure of the business would have an adverse direct or indirect financial impact on the local authority.

If successful, the amount of relief awarded will depend on:

a) The rateable value of the property ie a maximum of £2,599 in any one year if the rateable value is less than £12,000 or a maximum of £5,000 if the rateable value is between £12,001 and £25,499 (£21,499 up to 31st March 2010).

b) Whether the applicant lives within the London Borough of Harrow or not ie if within the borough they will receive 100% of the support, outside of the borough it will be reduced to 50% of the support.

Supporting Documents

Applications should be submitted with a short summary of the financial difficulties faced including confirmation of any lines of credit already sought eg bank loans, overdraft etc and the most recent accounts

Right of appeal and timescales

Right of Appeal

Appeals can only be made by the original applicant or an agent they have appointed to act on their behalf (written authorisation of this is required).

Appeals against the decisions of the Service Manager would be considered by the Divisional Director.

Appeals against the decisions of the Divisional Director would be considered by the Portfolio Member. Decisions made by the Portfolio Member will be final.

Any appeal must be made within 4 weeks of the letter issued by the council notifying the applicant of the decision.  Full details will be issued with the refusal letter.

Timescales

A decision will be made within 6 weeks of the application and all supporting information being received or as soon as practicable thereafter.

The decision will be notified in writing within 14 days of the decision being made.

Payment of Rates whilst a decision is being considered

Making an application does not give the applicant the right to stop making payments as previously demanded. Recovery action may continue pending the assessment of eligibility if a balance remains unpaid.

Business Rates Empty Property Form