Liability for business rates in insolvency
Liability for business rates in insolvency

The following Restructuring & Insolvency guidance note provides comprehensive and up to date legal information covering:

  • Liability for business rates in insolvency
  • Coronavirus (COVID-19)
  • What are business rates?
  • Who is liable to pay business rates?
  • What if the property is empty?
  • Quick guide to business rates in insolvency proceedings

Coronavirus (COVID-19)

This content is affected by the coronavirus (COVID-19) pandemic. For further details, see our Coronavirus (COVID-19) toolkit. For related news, guidance and other resources to assist practitioners working on restructuring and insolvency matters, see: Coronavirus (COVID-19)—Restructuring & Insolvency—overview.

What are business rates?

Business rates are a tax on property used for business purposes. They are charged on most non-domestic properties, such as shops, offices and pubs.

Business rates are also payable if you use part of a building for non-domestic purposes. For further information on business rates generally, see Overview: Business rates and Practice Note: Liability for business rates.

Who is liable to pay business rates?

In an insolvency context, the occupier of a property is liable to pay business rates.

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 considered to be in occupation depending on the actions of the officeholder—for example, it may be trading from the business while looking for a buyer.

For further information on what constitutes occupation, see Practice Note: Liability for business rates.

What if the property is empty?

Where a property is empty, business rates are still payable. However, the following are not