Confusion over new business rate rules
In the last Budget, George Osbourne announced that new business rates would be introduced from April 2017. However a recent survey conducted by CVS has found that over a third of business owners are "unfamiliar or unaware" about the upcoming changes.
Mark Rigby, Chief Executive at CVS, has provided advice around 5 key areas for any business owners:
What do the changes mean for local businesses?
“On the whole, the changes are very positive for local businesses. For many small firms, it will mean smaller overheads, less administration and an overall cost saving of as much as £5,900 in some cases. This is money that could be reinvested back into the business for better marketing, trialling a new product, or increasing staff hours, for example.”
When will the changes come into play, and what do I need to do beforehand?
“The changes are scheduled to be introduced from 1 April 2017. This is also when the next business rates revaluation takes effect – the process by which each commercial property has its rental value assessed by the Valuation Office Agency. This rental value is then used to calculate the business rates you pay each year on your bill.
The Valuation Office will publish its draft new values for each property on 1 October 2016 for consultation with local billing authorities.”
What about the regional differences, who gets the best deal?
“When the next revaluation comes into force, some businesses will move outside of the £12,000 threshold for rates relief, and some will fall within it. This largely depends on the specific nature of your property and where in the country it is located.
Business rates are currently based on rent levels assessed in 2008. So where rental levels have fallen since this time – such as for retail property in Northern England – business rates will also fall. Where rental levels have increased – such as in London and the South East in particular – business rates are likely to go up.”
How can I have my businesses property revalued, and will it save me money?
“The Valuation Office Agency is responsible for valuing businesses and it will often request information from a business owner via a ‘form of return’. However, because there are so many properties to evaluate – some 1.8 million – it’s easy for the Valuation Office to make mistakes in this process. Every ratepayer has the right to challenge their business rates bill at any time between revaluations. There is only one opportunity to do this however. Your chances of achieving success through an appeal – and therefore saving money – are improved if you get advice from professional, accredited surveyors.”
I need further advice, who is best to speak to?
“Information and advice is available on the Valuation Office Agency website. But businesses interested in saving money on their business rates should speak to a firm of professional surveyors such as CVS.”