New Rateable Values from 1 April

Newsletter issue - April 2010.

Business rates are a big fixed cost for many small businesses and it is not easy to move to smaller premises if your sales decline. What's more, the rateable value of commercial properties is revised every five years, normally upwards. The latest revaluation takes effect from 1 April 2010, but it is based on the market value of the property at 1 April 2008, when the value of all commercial property was at an all time high!

If you think you property has been valued too highly for business rates, you can appeal against the rateable value of the property. This can be done online through the website of the Valuation Office Agency (VOA): http://www.2010.voa.gov.uk/rli. However, before you decide to launch into an appeal you should check what your neighbouring businesses are paying, and whether they have already submitted an appeal against their premises value. You can also do that online on the VOA website.

You need to have good grounds for your appeal. For example, perhaps something in the property's immediate surroundings has altered and had a detrimental effect on trade. Perhaps there are a high number of empty neighbouring buildings, or there has been a change in the size or use of the premises. The VOA also encourages you to talk to your local valuation office before submitting a formal appeal against your business rates.

You can also apply for small business rates relief where the rateable value of the property is less than Â£18,000 (for properties in England). This normally needs to be done through your local rating authority. There are different small business rates relief schemes for properties in Wales and Scotland, which will have various caps for the relief available.

The Budget also announced a temporary increase in business rates relief for properties in England with rateable values of up to Â£6,000. Businesses occupying such properties can claim full exemption from business rates for 12 months from 1 October 2010. In addition businesses occupying English properties with rateable values of up to Â£12,000 will be able to claim a tapered reduction in their business rates from that date.