Business Rates Review: Technical Consultation
As trailed in the Government’s formal conclusion of its Fundamental Review of Business Rates a technical consultation has been issued covering four key areas:
– Measures to enable more frequent revaluations
– Improvement relief
– Support for Investment in green plant and machinery
– Other administrative changes
Our initial view is that the proposed measures to enable more frequent revaluations will massively ramp up the administrative burden requiring speedy reporting of property and lease changes and annual returns for all 2 million rated properties in England, even if there have been no changes or if no liability attaches to the property.
The system is already far too confusing and these new burdens, with the threat of fines, penalties and other sanctions for non-compliance raise the administrative burden and level of complexity significantly.
The consultation is divided into six separate chapters and whilst some measures will be brought in from the start of the 2023 Rating List others are not due to come into effect until 2026.
Included within the proposals are a number of fundamental changes which will potentially have a substantial impact on ratepayers with the only obvious benefit being the move to a three-yearly cycle.
From our initial review, we would draw your attention to a number of key issues:
Chapter 1: Provision of Information
The key focus here is the intention to move from the current position where there is no mandated requirement for ratepayers to notify either the VOA or billing authorities of changes which may have an impact on their business rates valuation to a new regime whereby ratepayers will be subject to:
“A duty to notify the VOA of changes to the occupier and property aspects that affect the assessment of the property for business rates” and a “Mandatory requirement to provide rent and lease information whenever a relevant change occurs as well as annually updated trade information used for properties valued for business rates purposes using turnover data.”
This information will need to be provided within 30 days of an event and will be subject to an annual confirmation, even if there are no changes to report, which must be completed online within 30 days of 31st March each year.
The current Forms of Return for cost information will be retained but the current 56-day time limit for completion will be reduced to 30 days in line with the new information requirements.
Chapter 2: Supporting Ratepayers to meet their obligations
The second chapter stays on the provision of information theme and promises a “single online destination for ratepayers or their agents to access and comply with the new obligations”.
The document refers to a “fair and proportionate” compliance regime which will provide “scope for lenience” where appropriate.
Whilst it is intended that the new duties would be introduced during 2023 Rating List much of this chapter is dedicated to deadlines, sanctions and penalties some of which are not expected to be introduced before 2026. Complex procedures are proposed with fines for failure to provide information and a new appeal process relating to penalties via the Valuation Tribunal for England.