covid banner

Empty rates relief clarified

The High Court has recently held that occupation of a very small percentage of a property counts as rateable occupation for tax purposes, allowing for a claim of empty rates relief once the period of occupation terminated.


In Makro Properties v Nuneaton and Bedworth Borough Council, the case concerned two companies, MPL and MSSWL. MPL owned the freehold of a warehouse and MSSWL took a lease of the premises until June 2009, after which point it vacated.

MSSWL later stored a quantity of paperwork at the warehouse between November 2009 and January 2010. Although the lease was surrendered in December 2009, there was an agreement in place for storage of the paperwork for the remaining month. The floor space occupied was said to be approximately 0.2% of the floor space of the warehouse.

At the first instance, the Court held that the occupation was so small as not to amount to actual occupation, and that the occupation was not beneficial to MSSWL. MPL appealed this decision.


The High Court held that it did amount to actual occupation as there was an intention to occupy and the use was not insignificant, notwithstanding the floor space involved. It also held that the storage was of benefit to MSSWL as it enabled it to comply with legal obligations.

The Court also held that in deciding who is in occupation, consideration must be given to the control exercised over the occupier by the owner. Clearly where the owner exercises no control and does not interfere with the

occupier’s enjoyment of the property, there can be no finding that the owner is in occupation.

This decision impacts on the ability of owners to claim empty rates relief at the end of an occupation, but owners should be aware that the conditions for rateable occupation need still be present, those being:

  1. Actual occupational possession
  2. Exclusive occupation/possession
  3. Having some benefit to the occupier/possessor
  4. Having some sufficient quality of permanence


This briefing is for guidance purposes only. RadcliffesLeBrasseur LLP accepts no responsibility or liability whatsoever for any action taken or not taken in relation to this note and recommends that appropriate legal advice be taken having regard to a client's own particular circumstances.