Local Taxation and Assessment

Question 1

What is the relevant legislation associated with Business Rates?

Answer 1

General Rate Act 1967
Local Government Finance Act 1988
Rating Valuation Act 1999

Question 2

What is the current Uniform Business Rate?

Answer 2

2020/2021
£0.499 for RV less than £51,000
£0.512 for RV over £51,000

£0.532 for City of London, Wales and Scotland and London with RV over £70,000 for Crossrail Supplement.

Question 3

When was the last Rating revaluation?

Answer 3

2017, based on values from 1st April 2015.

The next revaluation will be in 2023 with values from 1st April 2021 (Antecedent Valuation Date)

Question 4

How often is the list revalued?

Answer 4

Previously every 5 years but now every 3 years.

The annual updating of business rates has also switched from RPI to CPI.

Question 5

What were the recent Governement initiatives to assist businesses during COVID-19?

Answer 5

100% relief for 12 months for Retail, Leisure and hospitality

Grants for eligible small business users, e.g. £10,000 grant for businesses with RV of up to £15,000.

Premises in Northern Ireland, Scotland & Wales also benefited from rates relief.

Question 6

What factors are essential for rateable occupation?

Answer 6

BEAT

Beneficial Occupation
Exclusive Occupation
Actual Occupation
Transience or permanence

Question 7

What are the rules that must be satisfied for a hereditiment?

Answer 7

Single rateable occupier
In a billing authority
Be capable of separate occupation
Single geographical unit
Single use
Single definable position

Question 8

Who sets the Rateable Value?

Answer 8

The Valuation Office Agency (VOA)

VOA is part of HMRC

Question 9

What is the Rateable Value?

Answer 9

The annual rental value on the AVD of a property assuming a hypothetical tenancy based on the following assumptions:

Vacant
Available to let on an annual tenancy
FRI terms
In good repair
Tenant pays rates
Current use
No alterations may be made (only minor ones)

Question 10

What is the rating list?

Answer 10

A statutory document setting out rateable values.

Current AVD is 1st April 2015 for the new list from 1st April 2017.

Question 11

What are the methods of Rating Valuation?

Answer 11

Comparable
Contractors
Profits (Receipts and Expenditure)

Question 12

What is transitional relief?

Answer 12

A scheme for transitional relief to lessen the impact of large RV increases as a result of revaluation.

Question 13

What guidance has the RICS released on Rating?

Answer 13

Rating Consultancy Code of Practice 4th Edition - 2017

Question 14

What is a completion notice?

Answer 14

A notice served by the VO on the owner of a newly constructed property specifying a proposed completion day.

Section 46a of Local Government Finance act 1998

Prevents the party avoiding paying rates by not completing the construction.

Question 15

What did the RICS release on appeals?

Answer 15

RICS Rates Appeal Guidance Note, 2017

Question 16

How do appeals work?

Answer 16

An interested party can appeal the VOA

Grounds for appeal set out clearly - only once per applicant in the list

Check, Challenge and Appeal process

Target period notice - timescale set to agree the appeal by the VOA

Appeals are initially heard by the Valuation Tribunal

Can proceed to the Upper Tribunal (Lands Chamber) and House of Lords

Question 17

Can partially occupied buildings be exempt?

Answer 17

Yes - Section 44a of the Local Government Finance Act 1998

Allows for exemption from rating of partly occupied buildings, by appointment, at the discretion of the Local Rating Authority.

Question 18

What did the Business Rates Supplement Act 2009 enable?

Answer 18

Local Authorities can charge an extra 4.5% to raise money to be spent on Economic Development.

Only on RVs over £70,000

Question 19

What rules apply to empty properties?

Answer 19

Rating (Empty Properties) Act 2007

Empty property rate is 100% of rates payable
3 months relief for offices and shops
6 months relief for warehouses and industrial
If an empty property is re-occupied for more than 6 weeks and becomes empty again, it will qualify for the 3/6 month relief.
In Oct 2018, announcted the implementation of a retail discount scheme for rates for occupied premises with an RV less than £51,000 for 2020-21. 1/3 of bill discounted.

Question 20

What properties are exempt from Business Rates?

Answer 20

Vacant listed buildings
Charities
Properties where the owner is prohibited by law from occupying it - E.g Closing of demolition order
When the RV of the property is less than £2,900
Properties held by companies in administration or in receivership
Community amateur sports clubs

Question 21

What anti avoidance measures are in place to prevent Business Rates avoidance?

Answer 21

If property is damaged to avoid rates, VO required to disregard the changed state (needs to be capable of beneficial occupation)

Completion notice

Question 22

What recent rating cases do you know about?

Answer 22

Makro Properties Ltd vs Nuneaton & Bedworth Borough Council (2012)
- Intermittent occupation of warehouse

Newbigin vs S.J. & J. Monk (2015)
- Repairs vs improvements. RV of £0 when works being carried out that prevent it from occupation

Woolway vs Mazars (2015)
- Non contiguous floors under same assessment

Rosendale BC & Wigan Council vs Property Alliance Group (2019)

Sec of State for Business, Energy & Industrial Strategy vs PAG Asset Preservation Ltd (2019)

Question 23

What relief can small businesses get?

Answer 23

Small business rate relief.

RV up to £12,000 - no rates payable

RV £12,000 - £15,000 - tapered relief between 100% and 0%