Business Rates: Chancellor fast forwards next Revaluation
20 March 2018
If you are an occupier that pays Business Rates one of the most important aspects of the Chancellor’s Spring Statement is that the next Rating Revaluation has been brought forward by one year to 1st April 2021. To smooth out substantial increases caused by five-yearly Revaluations, they will now take place every three years after 2021.
What does this mean in practice? Well, your next Rating Assessment will be based on market rental values as at 1st April 2019.
Act now to mitigate your future liability
Rents agreed from now on will form the basis of rate liabilities from 2021-22 to 2023-24 inclusive, so it is important that you seek advice on strategy from our Business Rates Partner, David McCausland, immediately.
In previous measures to mitigate the impact of Revaluations, the Government introduced Check Challenge Appeal (CCA) last year to improve the Business Rates Appeals system by uncovering evidence early and encouraging the resolution of issues before formal Appeal, therefore resolving cases more quickly.
Although CCA has been the subject of criticism in some quarters, Farebrother - as registered agents - is already achieving success by early engagement on behalf of our clients.
In addition, we work with businesses to complete the forms which give the Valuation Office Agency (part of HMRC) the data it requires to complete the valuations which determine Rate Liabilities.
Comment
David McCausland comments: “We are seeing a raft of changes in the Rating system. These are aimed at alleviating the problems faced by businesses. The good news is that Government will consider the implications of more frequent Revaluations on the role and length of backdating.
“However, to realise the benefits, it is essential that all businesses fully engage with the system and this is where our expertise can assist. Rate Liability forecasting is especially important for business cashflow projections and we can help with this.
“Transitional Relief means that changes to Bills are phased in gradually but last year saw the steepest ever increases for the largest properties, whilst reductions were drip-fed. So, this is also an area which needs expert advice.”
This continued reshaping of the Business Rates followed the measures in last year’s Autumn budget which saw:
- The indexation of Business Rates from RPI to CPI moved brought forward
- Legislating retrospectively to address the so-called ‘staircase tax’
- Continue the £1,000 Business Rates discount for pubs with a Rateable Value up to £100,000
- A move to greater Local Government Business Rates Retention to at least 75% in 2020-21.
To discuss Rating Strategy and identify your future Business Rates liability, please contact:
Business Rates Partner
dmccausland@farebrother.com / +44 (0) 20 7855 3531
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