Local Taxation Flashcards
What are business rates?
A national tax on the occupation of land and buildings collected locally
What are the four essential ingredients to determine rateable occupation?
Actual occupation or possession
Beneficial to the occupier
Exclusive to the occupier
the occupation must not be too Transient.
What is a hereditament?
A single unit of rateable property which will be shown as a separate entry in the rating list.
The General Rate Act 1967
What are the six rules to satisfy a hereditament?
- Single rateable occupier
- In a billing authority
- Separate occupation
- Single use
- Single geographical unit
- Single definable position
What is rateable value?
Annual rental value of a property on the AVD assuming a hypothetical tenancy based on seven assumptions.
What are the seven hypothetical assumptions?
- Vacant
- Available to let on annual tenancy
- FRI terms
- Reasonable repair
- Tenant pays rates
- Current use
- No alterations
What reliefs are available?
- SBRR
- Transitional
- Empty
- Charitable
- Retail, leisure and hospitality - 75% relief for the 2023 to 2024 tax year limited to £110,000 per business.
- Rural - Population under 3000, only village shop/post office with RV under £8500 or only pub/petrol station with RV under £12500.
What legislation exists for Rating?
General Rate Act 1967
Local Government Finance Act 1988
Rating Valuation Act 1999
The Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act
What RICS guidance exists for Rating?
Rating Consultancy Code of Practice 2017 - PS
Surveyors Acting as Expert Witnesses 4th Edition Feb 2023 - Practice Statement
Surveyors Acting as Advocates 2nd Edition 2017 - PS&GN
RICS Rating Appeals 4th Edition 2017 (Archived) - GN
What properties are exempt from business rates?
- Domestic Property
- Parks
- Churches
- Agricultural land
- Lighthouses
- Property used for the welfare of disabled people - training
What leading case law exists in relation to the repair assumption?
Monk Vs Newbigin 2017
The case concerned a large office block in Sunderland. On the relevant date for valuation, the rate payer was in the midst of redeveloping the property.
Supreme Court held that properties undergoing substantial renovation are to receive nominal rating values.
What do you know about Canary Wharf V Jackson 2019?
The case concerned two floors of a tower block (One Canada Square) at Canary Wharf, which had been stripped out in 2011 following a previous tenant vacating.
At the relevant date there were no contract of works for redevelopment or refurbishment and no evidence of constructive works taking place at the property on the relevant date.
Supreme Court held that premises which are not capable of beneficial occupation cannot represent a hereditament, and therefore should not be included in the rating list, other than by inclusion at a nominal rateable value “as an administrative convenience”.
What is the leading case law relating to merging hereditaments?
Woolway v Mazars 2015
Mazars LLP, a firm of accountants, occupied Floors 2 & 6 of Tower Bridge House
The VT decided that Mazars’ floors were functionally essential to one another and, as such, they should be assessed as one.
The Supreme Court determined that none of the floors within the building were contiguous with one another.
What was the outcome of Woolway V Mazars 2015?
The Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act
Became law on 1 November 2018. The Act allows properties that are “contiguous”, and are in common occupation, to be treated as a single hereditament.
Allowed ratepayers whose hereditaments have been split (following Mazars ruling) to apply to the VOA to have hereditaments treated together.
