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New empty property relief affects administrators

The Non-Domestic Rating (Unoccupied Properties)(England) Regulations 2008 were laid before parliament by Local Government Minister John Healey on 26 February 2008. They follow the Rating (Empty Properties) Act 2007 which is designed to breathe new life into deprived areas in England and Wales by encouraging occupation.
 
They confirm that, with effect from 1 April 2008, all properties will be liable to 100% business rates whether vacant or occupied. From the date that properties become empty there will be a moratorium of 6 months for industrial or storage space and 3 months for all other types of property. Grade I and Grade II listed buildings continue to be exempt from business rates and properties owned by charities attract 100% relief.
 
More particularly for insolvency practitioners empty property relief is extended to administrations, thus nullifying the High Court decision in Trident Fashions (Exeter City Council vs Bairstow & Ors [2007] EWHC 400 (Ch) (02 March 2007)) where non-domestic rates were held to be an administration expense.
 
The explanatory memorandum that accompanies the new regulations estimates that this change represents relief to companies in administration, over and above any previous entitlement, of up £45 million per annum.
 
For those interested, the new legislation can be found at:
 
 
The Non-Domestic Rating (Unoccupied Properties)(England) Regulations 2008 (statutory instrument 386) http://www.opsi.gov.uk/si/si2008/uksi_20080386_en_1
 
 
Tom Dixon has 40 years experience in property and rating. He will be President of the Rating Surveyors Association as of 10 April 2008. He is a Fellow of the RICS and a Member of the Council of the IRRV.
 
Tom Dixon BSc (EstMan), FRICS, IRRV, Director, Rating, London
Tel 020 7851 2109
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