The new measures modernise business rate relief for empty properties
and, together with a newly introduced allowance to support the renovation of empty business premises in our most deprived communities and proposals to extend tax relief on brownfield sites, will better incentivise the re-use, redevelopment or sale of empty commercial property.

Businesses that rent premises will particularly benefit from the changes, which will increase the availability of premises, thereby reducing rents and increasing the UK's competitiveness.

Tax relief
At present, most empty commercial property receives a 100 per cent relief from taxation for the first three months, and 50 per cent thereafter; and empty warehouses and factories receive a permanent exemption from rates.

However, the Government believes that current system of providing tax relief for buildings that sit empty can no longer be justified when UK office rents are among highest in the world. From next April 2008, the relief will be modernised. Empty commercial property will be liable for the full business rate after an initial rate-free period of three months, or six months for factories and warehouses.

Charities and community amateur sports clubs will be granted a complete exemption from rates on their empty properties - a significant boost in Government support for the charity sector.

Local Government Minister Phil Woolas said: "The reforms will encourage owners of empty properties to bring them back into use, helping to create thriving and vibrant town centres. No-one wants to live or work next to an empty property, and it is frankly daft for the state to subsidise it when commercial rents are so high.

"That is why a package of reforms that will drive down those rents, encourage business growth, and promote brownfield development is needed. As well as reforming empty property rates, from last month a new 100 per cent capital allowance is available for the cost of renovating or converting unused businesses in deprived areas. Together these measures will incentivise and support action to bring empty shops, offices and warehouses back into use.

"Our reforms will also boost Government support for charities and community clubs by exempting all empty properties which they own from rates.

Full details of the new legislation can be found here.

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Susie Hughes
The Editor © Hardhatter 2007