1. Business Rates 2017 Revaluation and Beyond 27 April 2017 Bob Hancock

2. Contents What are non-domestic rates?
How are rates liabilities calculated?
2017 Rating Revaluation
Rights of appeal
Secondary appeals
Future of non-domestic rates
© 2017 Lambert Smith Hampton

3. What are non-domestic rates?
Rates are a tax on the right to occupy non-domestic property
Total yield in the UK = c.£27bn
Approx 1.8m entries within the rating list
Collected by local authorities (billing authorities)
Mainly retained by HM Treasury, but from 1 April partially kept by local authorities
From % retention by local authorities?
© 2017 Lambert Smith Hampton

4. How are rates liabilities calculated?
Calculation:
Annual liability = Rateable Value x Uniform Business Rate (UBR)
Subject to supplements, reliefs, exemptions etc.
Rateable Value
Annual rental value
Fixed point in time
FRI terms
Three methods of valuation
Uniform Business Rate:
Set centrally and increased by RPI each year
England = £0.466 (RV below £51,000)
Supplements (e.g. small business 1.3p, Crossrail 2p)
© 2017 Lambert Smith Hampton

5. 2017 Rating Revaluation
Since 1 April 1990 five yearly revaluations (2015 postponed)
1 April 2017 first revaluation for seven years
Valuation date (AVD) two years before – 1 April 2015
Undertaken by Valuation Office Agency (VOA) in England and Wales
Total increase in rateable value in England = 9.6%
Redistribute the tax burden rather than increase the total
Balanced by a reduction in UBR
© 2017 Lambert Smith Hampton

6. Rateable Value Change Area Retail Industry Office Other All England
4.8%
4.0%
12.7%
15.9%
9.6%
North East
-6.5%
-0.4%
-12.3%
9.5%
-0.9%
North West
-5.4%
-3.5%
-4.4%
10.7%
0.0%
Yorkshire & Humber
-1.9%
0.7%
-12.4%
7.1%
East Midlands
5.6%
3.3%
8.2%
13.4%
7.4%
West Midlands
3.4%
-6.8%
12.3%
3.2%
East
-3.6%
2.3%
2.4%
3.7%
London
26.8%
15.5%
22.6%
26.1%
23.7%
South East
1.2%
6.7%
12.9%
17.8%
South West
-5.7%
5.4%
13.9%

7. Rateable Value Change - Marinas
Total number of properties = 413
Total RV 2010 list = £19.6m
Total RV 2017 list = £22.6m
Average change in RV = 15.3%
Largest increase = 312%
Largest decrease = -50%
Total number of increases = 264
Total number of decreases = 124
Total number no change = 25
© 2017 Lambert Smith Hampton

8. Transitional Arrangements
Upwards Caps:
Property Size
2017/18
2018/19
2019/20
2020/21
2021/22
Small
5.0%
7.5%
10.0%
15.0%
Medium
12.5%
17.5%
20.0%
25.0%
Large
42.0%
32.0%
49.0%
16.0%
6.0%
Downwards Caps:
30.0%
35.0%
55.0%
4.1%
4.6%
5.9%
5.8%
4.8%

9. Right of Appeal Any interested party can appeal
Professional advice strongly recommended
New three stage appeal process:
Check, Challenge, Appeal
Online portal – registration required
If unable to resolve then Valuation Tribunal and Upper Tribunal (Lands Chamber)
© Lambert Smith Hampton

10. Secondary Appeals
Material Changes of Circumstances (must be physical and not economic)
Reconfiguration of moorings
New competition
Change of use eg to domestic
Reorganisation of assessments
Splits/Mergers
Relevant Valuation Tribunal/Upper Tribunal decisions
© 2017 Lambert Smith Hampton

11. The Future of Business Rates
Calls for reform
Review of business rates system
Self assessment
Blunting
Banding
More frequent revaluations
Remove transitional scheme
© 2017 Lambert Smith Hampton

12. Q&A