Business rates are a necessary cost for most businesses, but for those operating from listed buildings, they can pose a unique set of challenges. Listed buildings are protected by law for their historical or architectural significance, and as such, they often require special care and attention when it comes to maintenance and upkeep. This can make them more costly to run, and business rates are just one of the many expenses that can add up. In this article, we will explore the impact of business rates on listed buildings and what businesses can do to alleviate the financial burden.
Listed buildings are categorised into three grades in the UK – Grade I, Grade II*, and Grade II. Grade I buildings are of exceptional interest, Grade II* are particularly important buildings of more than special interest, and Grade II are of special interest. These designations are given by Historic England and act as a form of protection to ensure that the character of these buildings is preserved for future generations. However, this protection comes at a cost for business owners who operate from these buildings.
Business rates are taxes that are charged on most non-domestic properties, including commercial buildings, shops, offices, and warehouses. The rateable value of a property is assessed by the government’s Valuation Office Agency (VOA) based on a number of factors, including the size and location of the property. Business rates are used to fund local services such as schools, roads, and waste collection, and they can be a significant expense for businesses, especially those operating from listed buildings.
Listed buildings are often older than other commercial properties and may require more maintenance to upkeep their historical features. This can make them more costly to run, as businesses must adhere to strict conservation guidelines when making any changes to the building. Maintaining a listed building can be an expensive endeavour, and when coupled with high business rates, it can put a strain on the finances of businesses operating from these properties.
There are some exemptions and reliefs available for businesses operating from listed buildings that can help alleviate the financial burden of business rates. For example, businesses that operate from buildings with a rateable value of less than £12,000 may be eligible for small business rate relief, which can significantly reduce the amount of business rates that they are required to pay. Additionally, businesses that operate from listed buildings that are used for charitable purposes may be eligible for charitable rate relief, which can also reduce the amount of business rates owed.
Businesses operating from listed buildings may also be eligible for listed building consent, which can result in a reduction in their business rates. Listed building consent is required for any changes or alterations to a listed building, and businesses that are granted this consent may receive a reduction in their business rates as an incentive to preserve the historical features of the building. This can be a helpful way for businesses to save money on their business rates while still maintaining the integrity of the listed building.
In some cases, businesses operating from listed buildings may be able to apply for discretionary rate relief from their local council. This relief is available in exceptional circumstances where a business is facing financial hardship due to high business rates. Businesses must demonstrate that they are struggling to pay their business rates and that they have made efforts to reduce costs in other areas. While discretionary rate relief is not guaranteed, it can be a valuable option for businesses that are struggling to meet their financial obligations.
In conclusion, business rates can have a significant impact on businesses operating from listed buildings. The unique challenges associated with maintaining a listed building can make them more costly to run, and businesses must navigate these costs in addition to their business rates. However, there are exemptions, reliefs, and incentives available that can help alleviate the financial burden of business rates for businesses operating from listed buildings. By taking advantage of these options, businesses can ensure that they are able to preserve the historical integrity of their building while also managing their finances effectively.