A recent Court of Appeal decision has challenged a type of vacant property rates mitigation sometimes known as ‘box-shifting’.
The approach involved temporarily placing boxes or other items into an otherwise empty property in an attempt to establish a period of occupation. Once the property became vacant again, the intention was to qualify for a further period of empty property rates relief.
In City of London v 48th Street Holdings Limited & Anor [2026] EWCA Civ 970, the Court of Appeal found that, in the circumstances of the case, placing boxes into the offices purely to secure a business rates advantage was not enough to establish rateable occupation.
The decision has wider relevance. Following the judgment, MHCLG asked billing authorities to review similar arrangements and other occupation schemes intended to reduce rates liability and to withdraw relief where they conclude that genuine qualifying occupation has not taken place.
Read MHCLG's business rates information letter on the Court of Appeal decision
For organisations managing vacant property across larger estates, the ruling could result in greater scrutiny of arrangements that rely on short periods of occupation to influence rates liability.
It does not mean that every short-term occupation arrangement will automatically fail. However, it reinforces that the substance and purpose of occupation matter, particularly where an arrangement has been created primarily to secure a rating benefit.
For property teams, this makes it increasingly important to maintain a clear view of which properties are vacant, how they are being used and where occupation-based mitigation arrangements are in place.
More broadly, the case is a reminder that business rates exposure is shaped not only by policy and revaluation, but also by how established rating principles are interpreted through the courts.
Read the government's guidance on challenging a business rates valuation
Attention now turns to the Autumn Budget on 28 October 2026. Any further announcements affecting businesses will be closely watched as organisations continue to navigate 2026 and changing legislation.
Read HM Treasury's confirmation of the Autumn Budget date
For organisations managing complex estates, maintaining clear visibility of property status, rating activity and existing arrangements can make it easier to understand where changes such as this may have practical relevance.
Inform supports property and rating teams with more connected information across complex estates.
To find out more, contact our team at info@inform.services.
This article is intended for general information only and does not constitute professional advice. Readers should refer to official government guidance where appropriate.
