As a landlord, one of the many expenses you have to deal with is business rates. Business rates are taxes that are charged on almost all non-domestic properties, including rental properties. These rates can be a significant financial burden for landlords, especially those with multiple properties. However, there are ways to potentially reduce these costs through landlord business rates relief.
landlord business rates relief is a scheme that allows landlords to receive discounts or exemptions on their business rates. This relief can help landlords save money and make their rental properties more profitable. In this article, we will explore how landlord business rates relief works and how you can take advantage of this scheme to save on taxes.
One of the most common forms of landlord business rates relief is Small Business Rate Relief (SBRR). SBRR is a government scheme that provides relief to small businesses, including landlords who own properties with a rateable value below a certain threshold. In England, this threshold is currently set at £15,000, although it can vary in other parts of the UK.
Landlords who qualify for SBRR can receive up to 100% relief on their business rates for properties with a rateable value of £12,000 or less. For properties with a rateable value between £12,000 and £15,000, the relief gradually decreases on a sliding scale. This means that landlords with smaller properties can potentially have their business rates completely waived, while those with slightly larger properties can still receive a discount.
To qualify for SBRR, landlords must meet certain criteria, such as having only one property, or multiple properties with a combined rateable value below the threshold. Landlords should check with their local council to see if they are eligible for SBRR and to apply for the relief.
Another form of landlord business rates relief is Empty Property Relief. This relief is available to landlords who have properties that are vacant for a certain period of time. In England, properties are eligible for 100% relief for the first three months they are empty, and 50% relief for the following three months. After six months, properties are no longer eligible for Empty Property Relief and landlords must pay the full business rates.
Landlords should be aware that there are specific rules regarding when a property is considered empty for the purposes of Empty Property Relief. For example, properties that are being renovated or undergoing repairs may still be eligible for relief, as long as they are not being used for any other purposes. Landlords should check with their local council to see if their empty properties qualify for this relief.
In addition to SBRR and Empty Property Relief, landlords may also be eligible for other forms of business rates relief, such as charitable relief or rural rate relief. Charitable relief is available to landlords who rent out properties to registered charities, while rural rate relief is available to landlords with properties in designated rural areas.
It is important for landlords to explore all available options for business rates relief and to take advantage of any schemes that apply to their properties. By reducing their business rates, landlords can increase their profits and make their rental properties more financially viable.
In conclusion, landlord business rates relief is a valuable scheme that can help landlords save money on taxes and make their rental properties more profitable. By understanding the different forms of relief available, such as SBRR and Empty Property Relief, landlords can take steps to reduce their business rates and maximize their income. Landlords should be proactive in exploring their options for relief and should consult with their local council to see if they are eligible for any schemes. With the right knowledge and planning, landlords can save on taxes and improve the financial performance of their rental properties.