Q&As

Are business rates payable as an expense of the liquidation if the premises were not used by the business during the period for trading? Is there any exemption available to liquidators in these circumstances? If rates are payable as an expense of the liquidation, under what category of expenses in Insolvency Rules (England and Wales) 2016, SI 2016/1024, r 6.42 does it fall?

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Published on LexisPSL on 05/04/2019

The following Restructuring & Insolvency Q&A provides comprehensive and up to date legal information covering:

  • Are business rates payable as an expense of the liquidation if the premises were not used by the business during the period for trading? Is there any exemption available to liquidators in these circumstances? If rates are payable as an expense of the liquidation, under what category of expenses in Insolvency Rules (England and Wales) 2016, SI 2016/1024, r 6.42 does it fall?
  • Are business rates payable?
  • When is a property occupied?
  • Are business rates an expense of the liquidation?

Are business rates payable?

Whether business rates are payable in England and Wales will depend on whether the property is occupied or unoccupied. Occupied commercial property is liable for full business rates, whereas unoccupied commercial property will not be liable for business rates if an exemption applies. One of these exemptions is if the property (being a non-domestic hereditament) is subject to a winding up order made under the Insolvency Act 1986, or which is being wound up voluntarily under that Act. This exemption is found in the Non-Domestic Rating (Unoccupied Property) (England) Regulations 2008, SI 2008/386, reg 4(k).

When is a property occupied?

For a company to be rateable as an occupier, it must be in ‘actual possession’ and have a ‘sufficient measure of control to prevent strangers from interfering’. A company in an insolvency process may be in occupati

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