Local Taxation

Question 1

What is the definition of Rateable Value?

Answer 1

Schedule 6, paragraph 2(1) of the Local Government Finance Act 1988 (as amended by the Rating (Valuation) Act 1999):

Rateable value is an amount equal to the rent it is estimated that the hereditament would be let at on a tenancy from year to year assuming:

• The day on which the tenancy begins is the day at which the determination is to be made
• The property is in a good state of repair excluding any repairs that a reasonable landlord would deem uneconomic to undertake
• The tenant is responsible for bill and taxes and all repair and insurance costs as well as any other expenses required to maintain the hereditament

Question 2

What is the UBR?

Answer 2

Uniform Business Rate

2024/2025:
- Standard multiplier 54.6p (0.546)
- Small business 49.9p (0.499)

2017-2018:
- Standard multiplier 47.9.
- Small business multiplier 46.6.

Standard multiplier is used for RVs over £51,000.

Question 3

Can the UBR change?

Answer 3

Set yearly by Ministry of Housing Communities and Local Government (MHCLG) and takes into account inflation.

Question 4

What is the Antecedent Valuation Date?

Answer 4

Typically set 2 years pre revaluation taking effect to allow time for the list to be complied. Ensures that there is uniformity so that all hereditaments are assessed at the same date.

CASE:
K Shoes where values on Regent Street and Oxford Street were assessed 3 years apart and because of inflation one was paying much more than the other and it was ruled there needed to be uniformity.

Question 5

What is the date of the current AVD?

Answer 5

1/4/21.

Question 6

What is a section 44a?

Answer 6

Notice which apportions RV to the occupied part of the premises only.

Question 7

If the first floor of a premises is not used but is not capable of separate occupation, what option does the owner have?

Answer 7

They can:
- Occupy the space
- Apply for s44a notice
- Alter the property so capable of separate occupation to be let.

Question 8

How is section 44a granted?

Answer 8

1) Apply to BA saying which part of property not occupied
2) BA ask VO for the certificate
3) VO values the property and decides the apportionment
4) No appeal against notice
5) Valid for 3 months for non-industrial and 6 months for an industrial but will end at the end of the financial year regardless of how long it has been in place.

Question 9

What is a composite hereditament?

Answer 9

Mixture of domestic and Non-domestic such as a shop with living accommodation.

Question 10

What is transitional relief?

Answer 10

Scheme introduced because there had been a 17 year gap between from the 1 April 1990 revaluation and this was to ease liability changes between lists. For 2023, downward phasing is gone. Only upward relief why bills are increasing.

Question 11

What is small business rates relief?

Answer 11

Relief which reduces rates liability for small business’. It only applies to properties less than £15,000 RV.

For properties with a rateable value of £12,001 to £15,000, the rate of relief will go down gradually from 100% to 0%.

Question 12

When using FOR’s how can you verify the information?

Answer 12

Cross check it against similar properties nearby, contact ratepayer to double check, contact landlords agent to check.

Question 13

4 tenants of rateable occupation?

Answer 13

John Laing and Sons V. Kingswood Assessment Committee:

Actual - have an occupier in
Beneficial - occupation must be of value
Exclusive - only for purposes of the occupier
Transient - must not be too transient

Question 14

What is Rebus?

Answer 14

The idea that a property needs to be valued considering its current mode or category of use and in its current physical state, allowing only minor physical changes to be envisaged. These assumptions are set out in schedule 6, paragraph 2 of the LGFA 1988.

Question 15

What is schedule 5 of the LGFA 88?

Answer 15

Exemptions:
Agricultural Land
Agricultural Buildings
Livestock Buildings
Fish Farms
Places of public religious worship
Trinity house properties
Sewers
Parks
Property used for disabled persons – keeping suitably occupied / provision of welfare services.

Question 16

Jackson V Wharf

Answer 16

Repair & refurbishment

Office building was stripped to shell, question whether in a state of repair or “building undergoing reconstruction”

Agreed the property was incapable of beneficial occupation.

Question 17

Monk V Newbigin

Answer 17

Repair & refurb

Offices undergoing refurbishment which were incapable of occupation

Nominal value is to be used for properties undergoing substantial works

Question 18

Iceland V Berry

Answer 18

P&M

Looked at if P&M was part of the process for the building use

Air handling equipment for keeping freezers cool was argued to be taken into account in valuation

Determined that it should not be when part of the process.

Question 19

Cardtronics V Sykes

Answer 19

ATM’s capable of separate hereditament, however due to general control they are in rateable occupation of the host.

Question 20

Scottish and Newcastle V Williams

Answer 20

Mode & cat. of occupation (2 limbs)

VO wanted wine bar to be valued in line with shop - alterations under use limb would offend rebus sic stantibus ruling

1) Physical limb - property valued as stands, cant consider physical alterations
2) Use class - only consider in current mode & cat. of occupation

Question 21

What is PICO?

Answer 21

Property in common occupation act

Properties can be merged if contiguous - boundaries touching and units are not used for completely different purposes.

Question 22

Lotus & Delta V Culverwell

Answer 22

Hierarchy of evidence

Shop requesting values in line with comparables

1) Rent on property is starting point
2) Rents on other comparables close to property are next to be used
3) Comps in rating list after.

Question 23

Aviva Investors V Bunyan (Boyatt Wood)

Answer 23

Repair V Refurb

Warehouse - Tenant vacated and the property underwent minor works e.g. light fittings and cleaning, removal of partition in office. Toilet and kitchen ripped out which appellant believed made it in capable of beneficial occupation

VT found as warehouse remained occupiable, repairs fell to be disregarded under statutory repair assumption.

Question 24

What is the effective date?

Answer 24

The date the RV will change from

Question 25

What is a material date?

Answer 25

When the change happened i.e. the circumstances changed

Question 26

Which section in the LGFA details the Valuation Office Agencies statutory duty to compile and maintain fair and accurate Rating Lists for the Local Authorities?

Answer 26

s41

Question 27

What is the rating hypothesis?

Question 28

What legislation enforced CCA?

Answer 28

The Non-Domestic Rating (Alteration of Lists and Appeals) (England) (Amendment) Regulations 2017

Question 29

What is the first stage of the CCA process?

Answer 29

First you need to register as an individual or organisation under the government gateway account

Question 30

Can you register on behalf of your client?

Answer 30

NO - Criminal offence to register on behalf of your client. A client however can register an agent as an assistant

Question 31

Check process

Answer 31

• Factual matters
• Need supporting documents such as plans or rental information
• VO will change list if deemed it to be incorrect from info provided
• Occupants then have 4 months to submit an appeal.

Question 32

Challenge process

Answer 32

• Move to this if don’t agree with Check decision
• This must be made 4 months after the check decision or 16 months if it is in regards to a material change in the locality
• If disagree, appeal can be made within 4 months of decision or 18 months if they do not respond. Can be 16 months for an MCC.

Question 33

How long does VTE take to issue a response?

Answer 33

1 month

Question 34

How long does the VO have after an agreement or Valuation Tribunal to alter the rating list?

Answer 34

2 weeks

Question 35

Church of Scientology v Ricketts

Answer 35

Appeal on two buildings used by the Church of Scientology in London requesting exemption as places of public religious worship and related church premises.

Tribunal concluded some parts of each of the two buildings were exempt and others were not, depending on the uses to which they were put.

Question 36

York Museum case

Answer 36

This case went to the Upper Tribunal and is regarding a number of historic sites occupied by York Museums and Gallery Trust. One of the areas in dispute was whether the contractor’s method or the receipts and expenditure method used be used. The Tribunal considered that the contractor’s method was not appropriate and it should be valued on the R&E method. Such properties are unprofitable to operate and expensive to construct.

Question 37

Woolway V Mazaars

Answer 37

Offices were occupied by Mazars on the 2nd &6th floor of an office building.

Contiguous units need to be interconnected and easily accessed by one another. As the two floors could be let separately they were functionally independent. No exceptional factors with regard to enjoyment were present.

Question 38

What are the four classes of plant and machinery?

Answer 38

1) Power generation e.g. cables, conductors and wind turbines
2) Services to a property e.g. heating, cooling and supplying water
3) Rateable infrastructure e.g. including lifts and railway tracks
4) Process plant such as fixed cranes, masts and tanks

Question 39

What UK principles determines if P&M is rateable?

Answer 39

These factors are also guided by Schedule 5 of the Local Government Finance Act 1988.
1. The Reality Principle: This examines whether the item forms part of the overall hereditament (the property that is being rated). If it does, then it may be classified as rateable
. 2. The Premises Test: If the machinery is part of the premises, for example, it is built into the structure and cannot be removed without causing damage, this can be classified as rateable
3. The Use Test: Essentially, this involves determining if the item is used for beneficial occupation of the property, if it is, then it could be considered rateable