Following publication of the newly proposed non-domestic rating list for new rateable values to be introduced from 1st April 2017, Cambridge-based commercial property agents Barker Storey Matthews offer the following advice:
It has been 7 years since values for business rates have been reassessed and whilst the previous system for raising appeals had been in place for a significant number of years it was still heavily flawed with almost 300,000 appeals understood to still be outstanding from the 2010 rating list.
The hope was that the appeals system would be simplified, and become more transparent however the new “check, challenge, appeal” process proposed is overly complex and is generally considered unfair to ratepayers with potentially 3 years before a ratepayer is allowed to make a formal appeal and disincentives for submitting appeals essentially fining rate payers for unsuccessful appeals.
The Process Check – Rate payers can agree facts concerning the property with the Valuation Office Agency (VOA).
Challenge – This stage can only be instigated within four months of the check stage, with a further 18 months allowed to conclude the challenge.
Appeal – Those granted an appeal have up to 4 months to do so after the challenge stage and must pay a fee of up to £300 which is only refundable if successful.
The previous two phase system of appeal and tribunal has been replaced with a three phase system with proposals also suggesting that the Valuation Tribunal would only be able to order an adjustment to the proposed new rates if they are “outside the bounds of reasonable professional judgement”.
The new rateable values will continue to be based on rental values as at the antecedent valuation date (1st April 2015 for the new list) for many property types. There will therefore be an obligation on appellants to provide evidence for reducing the assessment on the basis of value and this combined with the proposed new complex process and potential fines for ratepayers could cause difficulties for unrepresented rate payers making appeals. Care, therefore, clearly needs to be taken and whenever possible professional advice sought.
There remain significant objections to the new process from the business community, Chartered Surveyors and rating firms as well as bodies such as the RICS with calls for the Government to reconsider its proposals but at present the new Check, Challenge, Appeal system remains on the table.