1.The Revaluation Overview for the Coastal BID area
Your Coastal BID team reviewed the draft revaluation NDRR 2017 list and noticed that few areas in average have gone up in value, e.g. West Cliff, whereas others have gone down, e.g. Boscombe. There’s also noticeable a tendency towards increased rateable values for pubs, clubs, restaurants (= night time economy) and decreased values for small / micro businesses in the conurbation of Bournemouth. This being said, the announced increased or tempered small business rates relief will support a vast number of small businesses in our Coastal BID area.
2.1. Your action required until 30 November 2016
Bournemouth Council is urging its local businesses to visit the website of The Valuation Office Agency (VOA), following revaluation of rateable values.
The VOA, an Executive Agency of HMRC responsible for assessing all rateable values of non-domestic properties across England and Wales, has completed its revaluation of rateable values, which are now published online. The revaluation of rateable values reflects changes in the property market across England and Wales since 2008.
Following this period of revaluation, Bournemouth Council is asking businesses to take the time to visit www.gov.uk/voa/revaluation before 30 November 2016 to avoid the risk of paying too much in business rates.
The process for checking is simple. All that local businesses need to do is to visit the VOA website at www.gov.uk/voa/revaluation find their property by postcode or address, and finally review the information to make sure the property details held by the VOA are correct. If the information held is incorrect please let the VOA know directly.
Revaluation takes place periodically, the last coming into effect on 1 April 2010. The new rateable value will come into effect on the 1 April 2017, so it is essential local businesses act before the 30 November to make sure their business rate charges are correct.
Businesses can access their bill estimates for 2017/18 via the VOA website.
For further details, please visit the VOA website here: www.gov.uk/voa/revaluation.
2.2. Setting Rateable Values
Apart from properties that are exempt from business rates, each non-domestic property has a rateable value which is set by valuation officers from the Valuation Office Agency (VOA), an agency of HM Revenue and Customs. The agency draws up and keeps a full list of all rateable values. This list is available on the Valuation Office Agency website . Your property’s rateable value will be shown on the front of your bill. The rateable value broadly represents the yearly rent the property could have been let for on the open market on a particular date. For the revaluation that comes into effect on 1 April 2010, the date was set as 1 April 2008.
The Valuation Office Agency (VOA), is in the process of updating the rateable values of all business properties. This is known as a revaluation. Business Rates Bills will be calculated using the new rateable values from 1 April 2017. More information on this is available from the Revaluation Guide.
The Valuation Officer may alter the value if he believes that there have been changes at the property. Ratepayers may also, in certain circumstances, propose that the value is changed. If the ratepayer and the Valuation Officer do not agree on a rateable value, he will refer it as an appeal to a Valuation Tribunal.
You can find out about when you can propose a change in a rateable value and how you should make a proposal by contacting the Valuation Office at www.gov.uk/voa/contact.
If you need advice about whether you should appeal, you may want to consult a good independent adviser. Members of the Royal Institution of Chartered Surveyors (RICS) and the Institute of Revenues, Rating and Valuation (IRRV), have to work to rules of professional conduct designed to protect the public from bad practice and they have to have insurance to protect you.
If you have appealed against your rateable value, you must still pay the amount on your demand notice. You cannot withhold payment until you get the result of your appeal. However, if your appeal is successful, we will automatically refund any rates you have overpaid, if appropriate.
3.Don’t sleepwalk in to Revaluation – be clear about your business rates.
The tax brought in £27.8bn for the Treasury last year, making it the sixth biggest source of income.
Business rates have become very controversial in the retail industry and have been blamed for the malaise on Britain’s high street. Most high street retailers pay more in business rates than they do in corporation tax and claim it hands an unfair advantage to online-only retailers such as Amazon, or out-of-town shopping centres who pay lower rates and no rates on their massive carparks.
- The Business Rates Revaluation 2017 in the media headlines
- Chancellor announces conclusion to business rates review in England
- Small Business Rates Relief to be permanently doubled from 50% to 100% for those with a rateable value of up to £12,000
- Inflation to be calculated by CPI, instead of the discredited and higher RPI measure.
- The government to explore more frequent revaluations a maximum of 3 years apart.
- The government to consult on impact of business rates cuts of local government finances ahead of fiscal devolution in 2020
- Your Draft Rateable Value 2017
Your draft rateable value and (for most properties) summary valuation has been published online on 30 September 2016 together with other information which the government hope will help you understand more about your valuation . The VOA or government has not been sending out printed valuations for this revaluation!!
At revaluation all properties are given a new rateable value multipliers are revised. This means that a change in your rateable value doesn’t always mean a change in your bill. Check your current values here.
Be careful considering before you appeal as rateable values can also go further up as outcome of your appeal! Your Bournemouth Coastal BID can support you with evidence when you prepare your case (footfall, vacancies rates etc) but cannot be held liable for any decisions by the VOA.
6. How to challenge the business rates liability?
Your business rates are calculated by the Valuation Office and based on a rental valuation of your property, while this calculation should be as accurate as possible there many ways that errors can occur when the RV is being set.
All appeals should be undertaken by a Chartered Surveyor and can be made and progressed on behalf of clients and where necessary by reference to the Valuation Tribunal Service.
They will always assess your valuation before proceeding with any appeal; there’re Chartered Surveyors in the market who carry out these assessment at no cost and if they believe your RV is fair they will not carry out any further work. Be still careful if they believe an appeal may be worthwhile :
Please Note: Never use an agent who claims any of the following:
- Guarantees a saving on your business rates or calls you out of the blue stating as such.
- Asks for an upfront fee to carry this work out.
Appealing the RV of a property is not relevant for all ratepayers, even though the option to do so is available.
If your Chartered Surveyor believes there may be scope for an appeal, one of their surveyors should inspect and measure your property and carry out a full assessment, again no appeal should be lodged until after this has been carried out and there should be still no fee due at this point.
Fees will be agreed on an individual basis, but will generally be based upon the reduction in Rateable Value achieved and so nothing is payable unless they are successful.
If you have a single site or a portfolio of properties, their thorough and niche historical audit work along side their appeal service can provide peace of mind for one of your largest overheads.
7. Getting professional advice In England, you can query your rateable value by contacting the Valuation Office Agency (VOA). There’s no charge for this.
Telephone (England): 03000 501 501
Find out about call charges
You can get help from a qualified rating surveyor through one of the following organisations:
You may be charged for any advice you get from a rating surveyor right from the start.
You can call the RICS enquiry line for advice. The first 30 minutes are free.
RICS enquiry line
Telephone: 024 7686 8555
Find out about call charges
8. How to find a local Chartered Surveyor?
The Coastal BID is sometimes approached to recommend specific chartered surveyors, please accept, that we are reluctant to do so. If you want to consider further, you can request advice from The Royal Institute of Chartered Surveyors (www.rics.org with Hotline T: 024 76 86 8555) who are very likely to recommend for the Bournemouth area from their current database:
Goadsby, T: 01202 55 00 00
Sibbett Gregory, T: 01202 66 11 77
Savills (Wimborne), T: 0102 856 800
This is not a comprehensive list and you may prefer to continue working with your renowned chartered surveyor.
However, please keep us informed if you consider appeal and feel free anytime to get in touch with us if you wish to find out more.
Coastal BID working in partnership with other organisations and bodies
Your Coastal BID is a member of Federation Small Businesses, Dorset Chamber of Commerce who are affiliated with British Chamber, Association of Town and City Management (ATCM) and Bournemouth Chamber of Commerce and also BAHA (Bournemouth Accommodation & Hospitality Association). We are working very closely with these organisations and advocating your interests on any matters related to business rates revaluation – including advocating changes on business rates to the benefit of our BID levy paying businesses.
10.Case Studies Business Rates Revaluation – National
Separately, business leaders from eight trade bodies have condemned government plans to clamp down on business rates appeals, claiming it could cost small and medium-sized companies more than £700m over the next five years.
A proposed new provision in the business rates system means businesses will only be able to challenge their rates bill if the margin of error is larger than 15%.
The Valuation Office Agency faces a backlog of tens of thousands of business rates appeals. The proposals could help to cut the backlog.
The new business rates appeal regime, known as Check, Challenge, Appeal, has been condemned by the Federation of Small Businesses, the British Property Federation, the British Beer and Pub Association, the Association of Licensed Multiple Retailers, British Hospitality Association, retail body Revo, Business Centre Association and the British Retail Consortium.
Martin McTague, policy director at the Federation of Small Businesses, said: “We welcomed the government’s ambition to make the business rates appeals system fairer and easier to navigate. However, it is hard to see how this proposal helps to achieve that aim.
“We believe this clause simply fails the fairness test and could result in the door being shut on small businesses who want to correct inaccuracies in valuations and reduce their rates bills. This research shows that businesses that are already struggling could be pushed into insolvency, with smaller firms particularly at risk.”
A. What does it means for Hoteliers?
This is the first time since 1990 that we have had more than a five year gap between revaluation cycles, and during that time we have emerged from recession and seen the property industry boom and bust. With the 2017 Rating Revaluation imminent, what has become evident is the increasing disparity between rental levels in core and tertiary centres across the country, which will affect all occupiers. The hotel market has experienced considerable changes. Room rates and occupancy levels have fallen significantly and have recovered since the last revaluation; and on the current list we can see around 1,000 new hotels have opened across the UK, particularly in core centres, boasting 70,000 new rooms for occupancy. Combined with extensive consolidation over the last few years, all of this activity will affect the business rate liabilities on your properties; however it isn’t always easy to identify where these opportunities are. From Collier’s market coverage and working with their colleagues in their specialist hotel division they have noticed that there are significant missed opportunities for MCC (Material Change in Circumstance) appeals and with the 2017 Rating Revaluation imminent they are conscious that hoteliers need to be fully prepared for the changes that they expect are on the horizon. With the largest specialist hotel departments encompassing Agency, Valuation, Development & Investment teams as part of the Colliers platform they are the only dedicated rating team combined with access to this knowledge and expertise enabling them to provide the most detailed assessment of your liabilities.
B. What does it means for High Street Retailers?
Britain’s retailers, already struggling with the economic uncertainty and volatile currency movements caused by the Brexit vote, face a £2.3bn tax hike next April, heightening fears that they will have to raise prices for consumers, in times of tough price competition with online traders.
The amount retailers pay in business rates – a tax on their shops and warehouses – will surge by £465.8m a year on average for the next five years, a total of more than £2.3bn over that period, new research shows.
The tax increase highlights the pressure on retailers. As well as the rise in business rates, retailers are tackling a slump in sterling – which has made importing goods more expensive – and the national living wage, which means every employee over the age of 25 must be paid at least £7.20 an hour. Dave Lewis, the boss of Tesco, has warned that retailers face a “potentially lethal cocktail” as costs rise while profits across the sector decline.
11. How to challenge the business rates liability?
Business rates are based on the rateable value of non-domestic properties, but an ever-changing business rates system in the UK has led to more and more business owners wishing to challenge their rates liability.
If rateable values have been applied incorrectly by the Valuation Office Agency (VOA), the impact on businesses as they experience unnecessary financial difficulties can be significant.
The Chartered Rating Surveyors at Eddisons have vast experience of challenging business rates across all industries. They understand the issues faced by sole traders and companies when their rates have been set incorrectly and have the rating expertise to quickly recognise any such inaccuracies. Their industry leading success rates in business rates appeals is down to the time they invest initially in assessing your business and property so that they only go on to work with you and pursue an appeal where it is appropriate to do so.
Credit notes: The content of this email is from various sources: www.gov.uk, www.voa.gov.uk; www.atcm.org.uk; www.theguardian.com; www.rics.org, www.colliers.com, www.bwb.co.uk; www.edisons.com
If you would like to discuss anything with us, please contact your Coastal BID Manager or Annette Plaistow-Trapaud, CBID Business Liaison officer (firstname.lastname@example.org). Or alternatively call our office 01202 291 200 to arrange an appointment.