2023 Business Rates Revaluation – Challenging your New Rateable Value
The long-awaited 2023 business rates revaluation is finally in force!
This means rateable values are now based on a valuation date of 1 April 2021 and should reflect the open market rental value as estimated by the Valuation Office Agency (VOA) on that date.
This has seen the total rateable value on the local lists for England and Wales increase by 7.1% overall, to £70.3 billion.
Challenging your Rateable Value
As with previous rating revaluations, some commercial property owners and occupiers have benefitted from the introduction of the 2023 Rating List, whilst others have lost out. Broadly speaking, occupiers of industrial premises have seen their rateable values increase, whilst occupiers of retail premises have seen their rateable values decrease.
In the South West, rateable values have increased by 9.5% overall. The industrial sector is bearing the main brunt of these increases, with rateable values increasing by 27% on average. The office sector has also seen an increase of 14% overall, whilst the retail sector has enjoyed a 4.7% decrease. The impact on the leisure sector is varied; some occupiers have seen vast increases to their rateable values, whilst others have enjoyed decreases. On average, however, rateable values in this sector have increased by 5.9% overall.
It is important for rateable occupiers to remember that rateable values can and should be checked for accuracy! A professional advisor can tell you if they think it will be possible to have your rateable value reduced and can work with the VOA on your behalf by following the Check, Challenge, Appeal (CCA) process. In the case of industrial properties, offices and shops, factual errors in your property valuation (such as the floor area) can be corrected by submitting a “Check”, which can lead to a reduction in your rateable value. Evidence can also be compiled to submit a “Challenge” to have the actual rate per square metre used in the valuation of your property reduced. In the case of trading properties such as pubs, restaurants, hotels and caravan parks, your rateable value is based upon your turnover between 2019 and 2021. Percentages are applied to your turnover to generate your rateable value and can – in some cases – be adjusted to reflect the true nature of your business.
If your rateable value has increased and you are eligible, transitional relief will limit how much your bill can change as a result of the revaluation. Furthermore, if you have lost small business rates relief as a result of the revaluation, the government has introduced supporting small business relief to ensure your bill will increase by no more than £600 in 2023.
Whilst there is some initial protection from 1 April 2023, the effects of the revaluation will still be felt by owners and occupiers, with the intensity of the increases accelerating in subsequent years. Whether your rateable value is increasing or decreasing, it is worth having it checked by a professional advisor, to ensure your liability is fair. Please contact [email protected] if you have any questions at all regarding your business rates.
