Listed buildings hold a special place in our communities, providing a link to our past and preserving historical architecture for future generations to enjoy. However, owning a listed building comes with its own set of challenges, including the payment of business rates. In this article, we will take a closer look at business rates on listed buildings, what they entail, and how they are calculated.
Listed buildings are those that have been designated as having special architectural or historic significance by the government. These buildings are protected under the Planning (Listed Buildings and Conservation Areas) Act 1990, meaning that any alterations or changes to the building must be approved by the local planning authority. There are three grades of listed buildings – Grade I, Grade II*, and Grade II – with Grade I being the most significant.
Business rates are a tax on non-domestic properties, including commercial buildings, shops, offices, and warehouses. They are charged by local authorities to help fund local services such as road maintenance, schools, and waste collection. In the case of listed buildings, business rates can be a contentious issue, as owners of listed properties often feel that they are unfairly penalised for preserving the historical integrity of their buildings.
business rates on listed buildings are calculated in the same way as on any other commercial property, based on the rateable value of the building. The rateable value is determined by the Valuation Office Agency, an agency of HM Revenue & Customs, and is used by local authorities to calculate how much a property owner should pay in business rates. However, listed buildings are often more costly to maintain and repair due to their historical significance and the restrictions placed on alterations, which can result in a higher rateable value.
One of the key issues with business rates on listed buildings is the lack of consistency in how they are applied. Some local authorities offer exemptions or discounts for owners of listed properties, while others do not. This can create confusion and frustration for property owners, who may find themselves paying significantly higher rates in one area compared to another. Additionally, the periodic revaluation of business rates can lead to unexpected increases in costs for owners of listed buildings, putting additional strain on their resources.
Despite these challenges, there are ways in which owners of listed buildings can reduce the impact of business rates on their property. One option is to apply for listed building consent to make alterations that improve the energy efficiency of the building, which can lead to a reduction in business rates under the government’s Business Rates Relief for Heritage Buildings scheme. This scheme offers relief of up to 100% on business rates for properties that have undergone approved energy efficiency improvements.
Another way to reduce business rates on listed buildings is to apply for discretionary rate relief from the local authority. This relief is granted on a case-by-case basis and is intended to support properties that have a special significance to the local community. Property owners can make a case for why they believe they should receive a reduction in business rates, based on factors such as the historical importance of the building or the economic impact of paying full rates.
In conclusion, business rates on listed buildings can be a complex and contentious issue for property owners, who often feel that they are unfairly penalised for preserving the historical integrity of their buildings. However, there are ways in which owners of listed properties can reduce the impact of business rates, such as applying for energy efficiency improvements or seeking discretionary rate relief from the local authority. By taking advantage of these options, property owners can ensure that their listed buildings remain a valuable asset to their community for years to come.