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Page 42
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All operators need to get up to speed on changes to the regulations governing local business rates. John Davies reports.
Many operators will have received a new "summary valuation" of their base from the Inland Revenue's Valuation Office Agency (VOA). About 1.75 million notices have been sent out as part of the process by which the VOA complies with its obligation to review the rateable value of all non-domestic property every five years. The current programme of revaluations is based on the value of properties on 1 April 2003 but won't take effect until 1 Apri12005.
The notice you receive—the individual valuations are also available for inspection on the internet, at www.voa.gov.uk — explains how the VOA has calculated the rateable value of your property. The VOA works out the property's annual rental value based on the assumption that it was available to let on the open market at the valuation date.
Rateable value is important because your rate bill depends on your property's rateable value multiplied by a factor which is set each year by central government. This factor — the Uniform Business Rate —is 45.6p in the pound of rateable value for the tax year 2004-05, but will be revised by the Chancellor for the next tax year beginning in April 2005. If you get a VA0 notice read it carefully, because failing to check its contents could cost you a lot of money.
If you discover any inaccuracies on your summary valuation notice you should make the necessary amendments and send it back to your local VOA office as soon as possible. Within 20 days you should hear what action the VOA intends to take.
If you act promptly there will be time to get any new rating assessments corrected before any incorrect rates demands are issued by your local authority.
If you do not dispute the summary valuation presented to you by the VOA, the summary valuation will be formally adopted for your property and your future rates bills will be based on it.You have the right to make a formal appeal direct to the VOA by letter or online, via the VOA website at www.voa.gov.uk Extended appeal Appeals cannot be made until the new scheme comes into effect, on 1 Apri12005. But after that date you can appeal at any time during the fiveyear 'life' of the new valuations. Also on 1 April 2005, small firms will be affected by the introduction of a new Small Business rate relief schem e. The details are still being worked out. but it looks likely that rate relief will be available if the rate payer occupies only one property and the rateable value of that property is less than £15,000.
Properties with a rateable value below£5,000 will receive relief of 50%; this will reduce on a straight-line basis to 0% when the rateable value reaches £10,000.
A small firm which operates from two sites with a combined rateable value of £9,500 will not be eligible for the relief — and it will have to pay a 1.6% surcharge.
Good news On the bright side, there is good news for sole property occupiers whose assessments are between £10,000 and £15,000. Occupiers who fall into this band will be able to apply to their local authority each year for exemption from the surcharge.
If your business is based in a "qualifying rural village" and has a rateable value of less than £12,000, your local authority can decide to write off your bill completely if it agrees that your business is of benefit to the local community.
Remember that whatever new rateable value is allotted to your property from April 2005, you may qualify for what is known as "transitional relief".
This is available to any business where a new rateable value results in a significant increase on the previous years' liability.
Any ratepayer who has any query about the new rateable values should talk to his or her accountant or contact the VOA helpline on 0845 602 1507. •