The VOA’s agent standards do not override any professional duties or standards set by a relevant professional body (i.e. RICS, IRRV, RSA). That said, we strive to meet the VOA's standards which focus on behaviour, professional practice and the service we provide to customers.
A full copy of the standards can be found here.
The rateable value of a property is the amount of money a hypothetical tenant would pay in rent per annum as at the Antecedent Valuation Date (AVD). The AVD for the 2023 Rating List is the 1st of April 2021. In short, the rateable value of a property is the amount of rent that a tenant would pay for 1 years occupation of a property, on full repairing terms, as at the 1st of April 2021. All business properties have a rateable value, which is determined by the Valuation Office Agency which is part of HM Revenues and Customs.
The next Rating List is expected to come into effect on the 1st of April 2026 and have an Antecedent Valuation Date of the 1st of April 2024.
You can look up your rateable value by going to the Valuation Office's website and entering your address details - click here to go there.
Alternately, your rates bill will have your Rateable Value on it. It may be next to a title of "RV" or "Rateable Value".
The majority of properties on the Valuation Office Agency's website are valued on the comparable method i.e. with reference to market rental evidence.
However, for more specialist properties where there is an absence of available rental evidence they may have been valued on either the Contractors method (with reference to construction costs) or Receipts & Expenditure Method (with reference to trade).
Once we have been appointed as your agents, we can request a detailed valuation on your behalf from the Valuation Office Agency.
Yes. All commercial properties have a rateable value, determined by the Valuation Office Agency and they may change the rateable value of a property if they feel that circumstances have changed since the last valuation. Every appeal is different and each is judged on its own merits and circumstances.
In cases where the Valuation Office Agency and a business ratepayer are unable to reach agreement about a change in rateable value, the matter can be referred as an appeal to a Valuation Tribunal. For more information on our approach please visit our main business rates page here.
Business Rates can seem daunting so we’ve explained the basics below, if you’re still confused though please don’t hesitate to contact us directly.
How are my Business Rates Calculated?
There are two steps to calculating the total amount owed each year in Business Rates on a property. These are :
The Rateable Value - the rateable value of a property is the amount of money a hypothetical tenant would pay in rent per annum as at the Antecedent Valuation Date (AVD).
The AVD for the 2023 Rating List is the 1st of April 2021. In short, the rateable value of a property is the amount of rent that a tenant would pay as at the 1st of April 2021 but with the property in the physical condition and circumstances as at the 1st of April 2023.
The Uniform Business Rate - This is a multiplier which is calculated each year by the government. The multipliers are generally between 49.9p and 54.5p in the pound depending on how large your Rateable Value is.
The Rateable Value is then multiplied by the National Non Domestic Multiplier to give the total owed. Deductions such as Small Business Rates relief or Retail Relief are then made.
Example
A shop with a Rateable Value of £20,000 would pay 0.499 x £20,000 = £9,980.
Why are my Rates more than my rent?
Your Rateable Value reflects what the Valuation Office feel a hypothetical tenant would have paid for your property as at the 1st of April 2021. Since this time markets have changed but we still value to this date for the purposes of business rates.
This isn’t fair – what can I do?
There are a number of steps you can take to reduce your rates bill but the most basic two are below :
The first is to appeal your existing Rating Assessment. You can find your rating assessment by going to the Valuation Office website and searching for your property
Secondly, if something happens in the local area that affects your trade and thus the rental value of your property, you can appeal. This is known as a Material Change in Circumstance. There is a long and complex history of case law around such situations and we would advise that you contact us directly to see if you have a case.
There is more information on Material Changes further down this page.
Yes, rates are payable on the basis of the rateable value currently appearing in the list and you remain liable to pay the account sent to you until such time as the rateable value in the list is amended. If the value is reduced, any over payment will be refunded.
Liability to pay Business Rates rests with the person entitled to occupation (i.e. the Tenant) of a property, irrespective of any third party agreement. You should discuss this with your Landlord, as agreements between Landlords and their Tenants are a matter between themselves and are not binding on a Local (or Billing) Authority in the event of any dispute between those parties.
Should a tenant pay a rent that includes business rates, but the landlord does not pass those payments to the Council, the Tenant will still be liable to pay and may then have to take action to recover the monies paid to the Landlord against the Landlord.
You may see "Transitional adjustment" or "Transitional payment" on your bill.
All rateable values are reassessed at each rating revaluation, the last one taking effect from 1st April 2023. To prevent ratepayers experiencing large increases in the amount due as a result of a national revaluation there are transitional arrangements which limit the annual increase to prescribed percentages each year.
In short, if you have a large increase in RV between lists then the increase is reduced whereas if you have a large decrease in your rateable value the full impact of the decrease will be reflected in your business rates bill.
Yes, we can provide recommendations on reliefs that may be available to you and if agreed, can make applications on your behalf.
You can apply for reliefs (e.g. Small Business Rates relief) yourself by making enquiries with your local billing authority. Similarly, you are able to lodge a business rates appeal without representation.
The Valuation Office Agency request rental, trade and cost information from ratepayers in order to maintain an accurate Rating List, this is most commonly known as a 'Form of Return'.
The form will usually consist of questions and for example could ask you about the key terms of your lease agreement. If you do need assistance in completing a Form of Return then please don't hesitate to get in touch.
Within the definition of Rateable Value (Schedule 6 Para 2 1 (b) of the Local Government Finance Act 1988), is the fact the we assume the subject property is in a reasonable state of repair, unless uneconomic for the Landlord to bring back in to repair.
Therefore, in most cases of minor repair we assume the property is not in disrepair.
However, if your property has had substantial damage e.g. fire damage or flooding, and the cost of bringing the property back into repair would be high, there may be merit in an appeal.
Alternatively, if it can be demonstrated that the property is undergoing refurbishment or re-development we can potentially appeal on this basis.
Each case will need to be considered on its own evidence and merits and therefore our recommendations will be tailored to your particular situation.
A split is when your rating assessment is split from one rating assessment (and business rates bill) into multiple rating assessments.
A merger is when multiple rating assessments are merged into one rating assessment.
A split may be beneficial if it creates smaller Rateable Values where the ratepayers are eligible for Small Business Rates relief. A merger may be beneficial as the £/m² could drop if quantum (economies of scale) kicks in.
However, there is no guarantee of a reduction in business rates liability for every case and therefore for any split or merger appeal there needs to be careful consideration of the facts and evidence as many factors can affect the resultant Rateable Values.
An MCC stands for a 'Material Change of Circumstance' and can be lodged to reflect changes to your property e.g. the removal of part of the property but also changes external to your property.
The existing 2023 Rating List was compiled on the 1st of April 2023, therefore a MCC proposal concerns matters that have changed since this date. The matters to be considered are listed below and an MCC must affect one of these five matters:
“The matters are—
a - matters affecting the physical state or physical enjoyment of the hereditament,
b - the mode or category of occupation of the hereditament,
c - the quantity of minerals or other substances in or extracted from the hereditament,
d - matters affecting the physical state of the locality in which the hereditament is situated or which, though not affecting the physical state of the locality, are nonetheless physically manifest there, and
e - the use or occupation of other premises situated in the locality of the hereditament.”
(Schedule 6 para 2(7) of the Local Government Finance Act 1988)
- Road or street works taking place which have a direct impact on your property.
- Building works or demolition nearby, or erection of scaffolding on a neighbouring property.
- Changes to road layout or pedestrianisation.
- An increase in the number of vacant properties, which are similar to your property and located close by.
- A new development opening within the locality such as a large superstore or a retail park that competes directly with existing business properties.
- A change in the use of a property. For example, a former retail premises opening as a large chain public house may impact on other public houses in the locality
The Rating (Coronavirus) and Directors Disqualification (Dissolved Companies) Act 2021 effectively outlawed the flurry of Covid-19 related appeals that were submitted during the Covid pandemic. This meant that many businesses that were forced to close could not contend their Rateable Values.
The recent Non-Domestic Rating Bill removes the possibility of submitting a Material Change of Circumstance (MCC) appeal as a result of government legislation.
This area of practice is therefore contentious and complex however if you require more advice on this particular matter than please don't hesitate to get in touch.
James Burkitt MSc MRICS
