2024/25 New rates Bills & Legislation

2024/25 New rates Bills & Legislation

Thanks for scanning the QR code – this page provides us with a bit more space to elaborate on the content of our letter.

Firstly, we want to give you comfort that you’re in the right place to get genuine expert advice on this very complex subject. Our team have over 150 years of business rates experience – you can check out their bio’s on the meet the team page. Our experience is wide and varied – between us we’ve dealt with almost every conceivable type of property across the country from the south coast to the Scottish border. Many of the team have spent time in the Valuation Office so have an insight on their internal processes– it’s important to know how the other side work.

Business rates is a complex and demanding subject, based on ever evolving legislation and case law. We understand the subject inside out – an essential part of being able to spot the angles and opportunities that others less experienced will miss. Expert advice combined with old school, traditional values of looking after your clients over the long term.

You’ve clicked on the link because you’re interested in reducing your business rates liability. There’s a multitude of ways we do this but its impossible to list everything here;- typically we make savings by reducing rateable values, through correcting floor areas, relativities and finding evidence to support a reduced £ rate sqm. We also amend effective dates where appropriate and consider lots of angles and options that our wealth of experience provides. At the end of the day there are steps we would need to undertake to decide if a reduction is worth pursuing, including a survey of your property to establish the floor areas and analysing the rent you pay. We have a genuinely unique data platform that allows us to identify evidence to support reductions for our clients.

The current rating list runs from 1/4/23 for a period of three years. If we are able to reduce your rateable value, then you would typically make savings over this three year period. We charge straightforward performance related fees based on a fair % of annual savings. No upfront fees, survey costs or other hidden charges.

A word of warning …we’ve seen examples from our clients of some of the speculative letters and emails that are prolific when rates bills are issued. Many make bold claims based on incorrect facts, designed to catch your attention. Members of the Royal Institution of Chartered Surveyors and of the Rating Surveyors Association will not make such false promises but will give a full review followed by a recommendation on whether to proceed or not based on the facts.

Beware of claims made without a survey, especially those that promise large refunds. If you have signed up to something with upfront fees or you are uncertain then we’re happy to have a chat and see if we can provide you some comfort or an understanding of how to proceed.

Please get in touch to find out more about our service.

Read on for more information on the future issues……

2026 Revaluation and 6 month appeal window

We mentioned the Non-Domestic Rating Act 2023 in our letter. Its not often we quote legislation in letters but the Act introduces sweeping and extremely punitive changes. The most obvious shift is that next rating list will come into effect on 1/4/26 based on rental values at 1/4/24 and for the very first time will have a 6 month window to appeal. This is a massive change that will effectively mean that every case needs detailed arguments to support reductions, along with rental evidence and reasoned arguments. Cynically its designed to reduce appeals and provide a stable tax base rather than preserving the right to appeal if you think a rateable value is wrong.

Improvement Rate Relief

The regulations have two conditional elements:

Qualifying Works – the floor area must increase or ‘otherwise improve the physical state’ or add to its rateable plant and machinery. Newly constructed properties nor refurbished properties that have been deleted from the rating list during works will qualify. A change of use alone or the addition of land also will not qualify.

The Occupation Condition – the same ratepayer has to be in occupation since the works commenced to ensure that support is not diverted to landlords, developers or businesses which have inherited improvements from a previous occupier.

What constitutes completion for rating purposes is typically different to practical completion from a contractual perspective and I can already see how this could be contentious. Occupiers with plans to complete work in the run-up to April should talk to us about this ASAP.

There is however the obvious elephant in the room – you don’t need to divulge the improvements so the VO may not pick up on them anyway. Until information sharing comes into effect at least.

Regulation, Information Sharing and fines

Information sharing – it sounds quite simple and innocuous but the implications and impact on the rating system are immeasurable. To give the VO the ability to provide more frequent revaluations, all ratepayers will have a statutory duty to provide information about themselves, their property, and their business. This represents a paradigm shift in reporting requirements – in the past, it has been down to the VO and council to identify changes with no onus or responsibility on the ratepayer, other than to complete the occasional sporadic rent return form.

The new legislation requires ratepayers – which will include occupiers of freehold and leasehold properties, plus landlords of vacant properties, to notify the VO of property and occupation changes within 60 days of them occurring. Install a mezzanine? Tell the VO. Refurbish an office? Tell the VO. Rent review/lease renewal agreed? Tell the VO. Failure to do so would result in fines for non-compliance.

Annual Confirmation Statement

In addition to all this reporting there will then be an annual confirmation statement, completed within 60 days of 30th April each year, to confirm that you have told them everything and that what you have told them is correct. Again, failure to do so would result in fines for non-compliance.

The VO have missed a trick in that occupiers don’t have to report missing historic improvements, only alterations that have occurred after implementation and in the relevant annual period.

What happens if there are historic alterations that the VO are unaware of?

We have many clients that have underassessed properties – for many rating lists the advice has been to do nothing as there are unassessed improvements ranging from extensions to missing yards, mezzanines and offices. Some of these changes go back many many years and will remain outside of the reporting requirements until another change elsewhere triggers a reportable event, which would then in turn trigger a VO inspection that would lead to the identification of the previously missed improvements. The old improvement wouldn’t benefit from the 12-month improvement relief and could be backdated (there are complicated rules around this). Tactically there are ways to deal with this to minimize risk and potentially manage any increase to ensure it’s right the first time – rather than entering an endless loop of Check Challenge Appeal action to fix the value and effective date of VO increases.

Linking Tax Information

The new legislation goes even further and will require the linking of tax information to property data as ratepayers will be required to provide HMRC with a taxpayer reference number submitted through the new rating ‘Super Portal’. The government have at least learnt its lessons from past IT blunders and mandatory introduction will follow a soft launch and an extensive public information campaign. Fundamentally the changes are there to facilitate more frequent revaluations, make sure that rateable values accurately identify and include any alterations to a property and reduce the opportunities for the widespread misuse of relief. This all amounts to the biggest shake-up in business rates ever and changes it from a subject that most businesses think about once every revaluation, into a live issue requiring ongoing attention where there are any changes. The burden of annual confirmation statements alone across large portfolios is a significant one, but whatever the size of your portfolio our advice to avoid nasty surprises, is to get a handle on it now and establish whether what you’ve got matches what the VO think you have. Theres more going on with business rates than at any time in the last 30 years. Get in touch to find out how this could affect you and your business.

KEY PEOPLE

PAUL ROBERTS

Director

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2024/25 New rates Bills & Legislation

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