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Covid-19 – The time for action is now!

The Budget of 11 March 2020 set out immediate reliefs (1 Apr 2020) for businesses, the details are published in the HM Treasury’s “Red Book” – [follow this link for more…]

  1. Flexibility:  The Chancellor started his speech by confirming that in the circumstances where any UK tax paying business was concerned or unable to pay taxes on time to HMRC, they would be offered assistance.  During his speech he stated that 2,000 HMRC call centre operators were ready to be contacted.  I take this at face value and I have assumed that this will apply to business rates as well as Central Government taxation given that 50% of business rates does go to the Exchequer.
  2. Business rates retail discount – for one year from 1 April 2020, the business rates retail discount for properties with a Rateable Value below £51,000 in England will receive 100% relief for the 2020/21 rate year.  Those properties that can qualify for this relief has been expanded to include as many hospitality uses as possible, beyond the usual retail criteria.  Cinema & music venues are cited but we also take this to include B&Bs, guest houses, hotels, motels, arcades, and visitor centres.  The cost of this relief (loss of revenue) to Local Authorities is underwritten by Central Government.
  3. Business rates pubs discount – The government now gives a £5,000 business rates discount for pubs for the 2020/21 rate year where they have a rateable value below £100,000 RV in England.
  4. Business rates local newspaper office space discount – The £1,500 business rates discount for office space used by local newspapers in England will be extended for an additional five years until 31 March 2025.
  5. Business rates public lavatories relief – The government will bring forward legislation as soon as possible in this session to provide mandatory 100% business rates relief for standalone public lavatories in England from April 2020.

The Chancellor restated that Local Authorities will be fully compensated for loss of income due to the application of these reliefs.

Other announcements concerned a review of the future of the business rates system and extra funding to modernise what is left of the Valuation Office Agency.

You cannot alter your Rateable Value unless you register, claim the property and appoint an agent.  There is nothing to gain by delaying registration and to do so limits the ability to take swift corrective action.  Please register!

The “gold standard” of business rates advice comes from an RICS qualified Chartered Surveyor.  This is no time for half attempts at serving “Checks” under the CCA regulations nor making abortive claims for reliefs that needed proper documentation for a claim to be successful.

If your business is retail, hospitality or another use directly affected by this pandemic – you need to serve a protective “Check” – now!  The physical circumstances of an appeal for a “material change in circumstances” is taken as the date that the “Check” was served.  We don’t know how long these unique circumstances will exist – so serve now (plan for the worst – hope for the best).

You will know best – can your business afford to pay it’s business rates in light of the Pandemic?  Local Authorities are being briefed by Government on the requirement to be flexible on repayments of taxes, there may even be more business rates reliefs to come?  You do not want a breakdown in communication to lead to a Magistrate’s Summons – everyone knows this is going to be a tough period.  If you communicate early then you avoid undue stress.

You may have had perfectly reasonable advice to leave your Rateable Value alone in the past – this is the perfect time to review whether that advice still stands.  Under-assessment at 1 April 2017 may not be the same conclusion when considering values affected by the Pandemic?  Reconsider and examine the line-by-line valuation with your agent.

If you are suffering a sales slow-down or increased vacancy rates you need to maintain a week-by-week performance record that can be compared to the year before.  At some point, if you served a “Covid-19 MCC Check”, the burden of proof is to show how this is affecting your sales/receipts.  The VOA cannot do it for you.  Your records are central to any future negotiation on the material impact to your business.

There are sections of the Local Government Finance Act that award temporary empty rates relief to partially vacated areas.  If you have excess space, get advice on launching a partial empty rates claim to get relief now.