Business Rates can represent a significant annual cost to any business. The Valuation Office Agency (VOA) historically reviews ‘Business Rates’ in 5-year cycles, however the last cycle to April 2015 was extended to April 2017.
The Rateable Value of a property is a broad representation of the annual rent for which the property could have been let on the open market as of two years prior to the effective billing date.
Subsequently current billing which commenced in April 2017 has been based on the Agency’s valuation of the premises around 2 years before.
By comparison, the previous cycle commenced in April 2010 where the property valuations, completed two years before, may have resulted in higher Rateable Values being carried through the extended cycle to 2017.
As the latest Rateable Values which commenced on 1st April 2017 may continue to reflect the inflated values from the previous cycle, and not necessarily the reduced recessionary values applicable from around 2008 to the present day, over-payment may continue through the new cycle unless challenged.
How The VOA evaluates business premises:
The VOA generally evaluates business premises on a generic basis and without identifying specific circumstances on a property by property basis.
The VOA puts similar properties into a group called a valuation scheme and:
- Applies a range of values per m² (or unit) to the valuation scheme
- Applies a base rate to individual properties in the scheme and measures the property using a method called gross internal area (GIA), which measures the whole enclosed area of a building within the external walls.
If necessary, the VOA then make adjustments to the rate given to each of the property’s different parts.
The Rateable Value of the property is the sum of all the rates given to its different parts, rounded down to the nearest £1,000.
Business properties may therefore wrongly valued due to:
- An inflated rateable value applied pre-recession which hasn't been subsequently reduced.
- A physical change in the building or local area
- The use of the building being changed in whole or part
- The property or part of the property being exempt
- The split property not being treated as such, or several properties which should be merged for valuation purposes
- The property value being inconsistent with similar properties in similar areas
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The Government has introduced a new business rates appeals system to coincide with the 2017 revaluation. How properties are valued and how business rate are calculated remains the same – the key difference is in the assessment and appeals process if a business rate is considered inaccurate.
This process is called 'Check. Challenge. Appeal.' This 'CCA' system creates a range of barriers and disincentives, such as fees and technical requirements. In addition, fines have been introduced for careless mistakes or submission of incorrect details.
- Rateable Value in excess of £20,000 per annum
- No current or previous formal appeal can have been lodged within the current cycle (from April 2017)
We hope you will share our view that ‘nothing ventured, nothing gained’ and with no financial outlay unless you win, and little resourcing required during the process why wouldn’t you contact us to discuss if your own Business Rates could be reduced?
B2B works closely with our specialist professional partners to identify potential rebate cases and optimise the opportunities for a successful 'CCA' process.
Our Business Rates professional partners have been specifically chosen for the following reasons:
- market Business Rate Rebate specialists recommended to us by clients who have already saved money
- No costs incurred except on success and even surveyors fees are paid by our professional partners.
- A ‘worry-free’ process with only nominal resource required for meetings with their surveyors
- During the previous cycle from April 2010 they lodged 60,000 appeals on behalf of businesses, acheieving an average of 9.2% in rate reductions, but as much as 30-40%
- Surveyors are ex Valuation Office Agency staff
- Any savings are back-dated to April 2017 and projected to the end of the current cycle
- A proven strategy for breaking down the RV into various finite elements including location, sector, usage (room to room), and compare these with other similar properties in similar locations.