Charitable Business Rates Relief

Charities get significant relief from business rates, and this also underpins a common empty-property mitigation strategy. Here is how it works.

The relief

A property occupied by a charity, and used wholly or mainly for charitable purposes, qualifies for 80% mandatory relief from business rates. Billing authorities can also grant up to a further 20% discretionary relief, potentially reducing the bill to nil.

The empty-property angle

Because occupation by a charity is relieved, granting a short lease or licence to a qualifying charity is a recognised way to relieve an otherwise empty property, while the charity makes some use of the space. The occupation must be genuine and for charitable purposes, and billing authorities and the courts scrutinise arrangements that look artificial.

Getting it right

• The occupier must be a charity (or certain similar bodies) and the use must be wholly or mainly charitable.
• Apply to the billing authority for the relief.
• For discretionary relief, the authority has a choice, so it is not guaranteed.

Caution

Charity-based empty-rates schemes have attracted challenge where the occupation is a sham. Keep any arrangement genuine and take advice. See business rates mitigation and empty property rates.

How much charitable rates relief is available?

80% mandatory relief for a charity using the property for charitable purposes, plus up to 20% discretionary relief, potentially reducing the bill to nil.

Can a charity let relieve empty rates?

Granting a genuine short occupation to a qualifying charity can relieve an empty property, but sham arrangements are scrutinised.