Can the Check, Challenge, Appeal process be quicker in cases of hardship?

The Valuation Office Agency have made some courageous statements to the Select Committee regarding their response to a ratepayer whom declares he is facing hardship.

My own experience is that it has made practically no difference, however, since viewing this testimony before the Treasury Select Committee on 10 July 2019 by Melissa Tatton, Chief Executive Officer, Valuation Office Agency, and Alan Colston, Chief Valuer, Valuation Office Agency, my view is changing. There are some useful promises made which the Ratepayer should have no hesitation in quoting when they believe they (or their client) is experiencing hardship.

Testimony of Alan Colston VO on 10 July 2019

Transcript: 

Alan Colston: There is already a process for those suffering financial hardship, which we prioritise. If a particular business is suffering financial hardship and thinks its rateable value is wrong, it needs to let us know about that. 

Q471       Chair: What do they need to tell you? 

Alan Colston: Just literally what I have just said: that they are suffering financial hardship.  

Q472       Chair: Do you ask them for bank statements, directors’ earnings, what people are taking home or the number of employees being fired? 

Alan Colston: No.  

Chair: Really? 

Alan Colston: No.

Chair: A business is just going to contact you and say, “I’m in financial hardship. My rates bill is proving to be impossible to pay. Can you please accelerate?” 

Alan Colston: And we will.  

It is my recommendation that if you are suffering hardship and you have an active Check outstanding with the VOA, you should contact the VOA through your portal and state the following: –

I, the ratepayer, am experiencing hardship and I have a “Check” outstanding within the CCA system. I would like you to accept this notification as my formal notice that I am experiencing hardship and in accordance with the testimony of Alan Colston and Melissa Tatton given to the Treasury Select Committee on 19 July 2019, I would like you to accelerate my case and make contact with me.

As a matter of course, I would recommend you send a copy by post to Mr Colston, reminding him of the VOA’s undertaking to Parliament. His email address is – alan.colston@voa.gsi.gov.uk

Further information concerning the testimony can be found on the Chartered Institute of Taxation’s website here

GCLG

It is as if there will be an election around the corner? NNDR multiplier for 2020/21 is re-engineered

Usually by October each year we know what the growth in the two preceding September CPI’s are and this gives us the meat to put in the sausage machine to calculate next year’s “rate in the pound” or more properly known, the NNDR multiplier. This October 2019 many observers have been wrong-footed by the latest Government announcement slightly reducing the estimated £0.500/£.

The Government now approved The Local Government Finance Act 1988 (Non-Domestic Rating Multipliers) (England) Order 2019, and have set the Statutory Instrument to prescribe the rate for NNDR at £0.499p/£ for small properties and £0.512/£ for large properties

The history of the NNDR multipliers for the 2017 Rating List in England is shown below: –

Rate YearSmall Property (RV <£51,000 RV)Large Property (RV >£51,000 RV)
2017/18£0.466£0.479
2018/19£0.480£0.493
2019/20£0.491£0.504
2020/21£0.499£0.512

As Britain lurches forward to a winter General Election amidst a sea of uncertainty her government is preparing for all eventualities regardless of what political powers will form the next administration.  There are those of us who are charged with the duty to others and have the burden of leading business of all sizes going forwards, we need to plan for the future.

  • Fact:      Business rates started in 1601 and has been relied on throughout wars and turbulence to deliver a steady stream of revenue to fund government expenditure, it last major reform was 1988.
  • Fact:      Business rates is responsible for delivering £31 billion pounds to the Exchequer.
  • Fact:      Whilst other sources of taxation are volatile (corporation, income & inheritance tax as examples) – business rates delivers year on year revenue that exceeds the rate of inflation.

The Government has received the Treasury Select Committee Report on 31 Oct 2019 and representative organisations have supplied evidence.  Interestingly beyond the complaints of being a regressive system, realistic proposals have been placed, such as:-

An alternative Land Tax, by encouraging the best use of land, particularly in more valuable locations, encouraging public investment in infrastructure and linking the consequent increases in land value to revenue so investment projects could become potentially self-funding.

Proposal to cancel the forthcoming reduction in the corporation tax rate from 19 per cent to 17 per cent and reducing the business rates multiplier instead.

Introduce a 2 per cent levy on the online sale of physical goods raising approximately £1.5 billion and then use this money to fund a 20 per cent cut in business rates for all retailers.

A single consolidated tax for small businesses encapsulating Corporation Tax, Employer’s National Insurance, VAT and business rates in a singly easy-to-administer system.

What can you do now?

We do not have the luxury of waiting for a magical reform that will leave our business better off, there is a checklist to be executed now: –

  1. Register your company on the VOA portal and claim your properties.  Tax is being made digital on every front, business rates went digital on 1 April 2017 and the majority of ratepayers have not registered yet.  No registration – no ability to challenge or reduce your business rates.
  2. Have you claimed your allowances?  Government has flexed with public pressure to offer relief schemes – there are many.  Make sure you get advice on your eligibility.
  3. Are you paying by twelve monthly instalments?  Many businesses are paying on the old system of ten monthly instalments, check your rate demand.
  4. The VOA publishes your floor areas and basis of valuation, just a cursory glance may either tell you whether you are over or under assessed.
  5. The Royal Institution of Chartered Surveyors (RICS) is the gold standard of rating valuation and business rates advice – a Chartered Surveyor is uniquely equipped to give you initial advice.

Roderick Bisset of Vail Williams is a Chartered Surveyor who has practised in the field of business rates for 29 years – for further information and initial advice – rbisset@vailwilliams.com