2017/18 Proposed Business Rate Reviewal - Some alarming increases!

[Snoopy1948]

Although I worked in Local Authority Taxation for some 23 years, I have been retired for two years now so a little out of the loop as to current practice.

However, I have some good friends who run a café style business and are currently trading 'by the skin of their teeth' which is going to be exacerbated by current inflationary and 'post Brexit' rises, let alone any increase in the Business Rate.

Their current 2016/17 Business rate is as follows :

Current RV £8000
Multiplier 0.497 in the pound
Annual Bill £3872
But Small Business rate Relief £2581
Giving an annual bill of some £1290

Their proposed/estimated 2017/18 Business rate bill ( via the Valuation Office and Gov.uk site ) is :

New RV £24500
Multiplier 0.467
New Annual Bill £11441
NO small business rate relief ( as RV too high )
But Transitional Relief in year one of some £7007
Therefore New Annual Bill ( year one ) estimated at £4434
But rising to £11441 ( as I see it ) as transitional relief expires.

The VO site puts the increases simply down to changes in the property market ( i.e. values and rentals ) but gives no other explanation apart from that. There is no stated or recommended route of appeal other than to 'check the information that the VO holds is accurate and up to date'.

Clearly with such a threatening increase my friends will probably have to seriously consider their position. But we have a much bigger picture here that every business, regardless of size, will suffer financially and put many trading positions at risk.

I would appreciate anyone's feedback on this one particularly from any who work in LG Local Taxation. Are there any routes of appeal that would involve trading hardship? I expect the next great thing to come will be a Council Tax Banding review and that's a prospect that I find particularly scary! :closed_2::closed_2:

[Snoopy1948]

Re: 2017/18 Proposed Business Rate Reviewal - Some alarming increases!

[distress]

Re: 2017/18 Proposed Business Rate Reviewal - Some alarming increases!

You remember the first woman who went to jail for refusing to pay council tax. Even murderer such as Bronson Chapman or robber like the Grays get interview,and their own television program, you ever wonder why the media, the internet never mentions that woman again.

[Snoopy1948]

Re: 2017/18 Proposed Business Rate Reviewal - Some alarming increases!

Thank you for your comment distress ( very apt name for local taxation recovery ! ) but I cannot see how it is relevant to my posting.

I was certainly hoping for people connected to business (with business rates to pay) to give experience feedback on this issue as I am sure that there must be financial hardship out there as a result. With regard to the case mentioned, initial complaint was made directly to the Valuation Office who, without reason, dropped the draft valuation for 2017/18 from £24500 to £13000. The tax payer also made parallel complaint to his MP who submitted the complaint via The Adjudicator's Office who in turn responded and told the complainant to proceed with parts 1 & 2 of the 'complaint's procedure' before they could give specific attention to the matter.

I have to admit that I have never seen any intervention from the 'Adjudicator's Office' before.

The tax payer remains in discussion with the VOA as to reducing the RV down to £12000 or below so that he may enjoy maximum Small Business Relief that the chancellor promised in 2015 and we are waiting on a decision on that.

The point about this all is that the new 2017/18 revaluation for Non Domestic Rating appears to have been done with some 'arbitrary reasoning' and unless you complain you will simply be expected to pay it. Almost increased taxation 'by the backdoor'! And you don't need to engage professional help as you can complain very much with your own reasoning in appeal.

But I would really like to hear other experiences ..... .

[distress]

Re: 2017/18 Proposed Business Rate Reviewal - Some alarming increases!

Sorry Snoopy1948.

The reason I mention that woman is because I think if one of us going to prison for non payment they would listen. We have to chain together and stick together to say No More. I have talked to 4 other business owners all agreed something needs to be done. If 1 of us go to prison we 5 stick to decision. If thousand of us prepare to go to prison for not accepting the annual rate hike, there would be no enough room.

At the moment BR Letters sent out and we just start to pay, or else... We are so weak...

Even the big six in London have joined political campaign last year requesting for reform of business rate, and zig thousands businesses have signed petition against hike of business rate etc before the election. Nothing happens,

OK, there is a transitional relief for one year, and then? I used to pay when start trading 565 per month the year before 880, now 1120 and next year 1300/1400... What then after that? Money is not from tree...

The way it is, until half of the big 6 may be gone, the business rate govern body might or might still not wake up.... I have contact my council and applied for hard ship relief. They say "Pass on the increase to customers, and there a similar business like (my) laundrette in the areas so it is not true that it is essential facility in the neighborhood,...so no reason for granting hardship relief" Although those are half a mile or more apart from mine.

The way they think is ; "No, no, rate and rent and cost hike can not drown business, the market will regulate itself, but only those silly traders don't know how to pass on the ball."

I have told the other four that you managed to help your friend get the RV down. We are interested very much how. Most of us were scammed out of money 400, 700 for reduction of business rate by certain surveyors.

and no, none of us enjoys to go to prison.

[Snoopy1948]

Re: 2017/18 Proposed Business Rate Reviewal - Some alarming increases!

Hi Distress and thank you for the further info! All is apparent now and I can well understand how your original comment was not simply 'off the cuff' and without good reason.

I worked as a local authority enforcement officer for 23 years, retired 2014, and enforced not only business rates but also council tax and sundries like overpayment of housing benefits ( normally through fraud ). I 'cut my teeth' on Community Charge in 1992 and that was a sharp learning curve!

I was directly employed by the local authority, so a local government officer, and held a court licence to execute warrants of distress ( hence me picking up on your name! ). Not once in that 23 years do I remember one case being committed to prison for non payment of National Non Domestic Rates. To be committed to prison for such an offence must include 'Wilful Refusal to Pay' ( i.e. you stood in front of a magistrate and refused to pay by objection ) or 'Culpable Neglect' ( where you had the means but chose to ignore the charge ).

Having said that, the threat remains part of the script and there is no doubt that many, many more people would take their chance if that disappeared.

I had always said, from the start, that Business Rates were in many ways unfair as they were simply a tax based on you being there and trading, regardless of whether you made enough money to cover them. Having said that, I lost count of the number of people ( who I visited ) who paid premiums for small businesses without doing a business plan or being aware of the local taxation liability.

I believe that the current 2017 hike is an exercise in generating substantial income increases without any substantive evidence that it can be generated in response. The VOA states that the revaluation was necessary to accommodate the substantial increase in property values and/or rentals being demanded'. I believe that is nothing more than a sophisticated cover for 'cash cow'.

As you say, transitional relief is available but only temporary and again, I believe, a bureaucratic 'comfort pill' that holds zero value.

Everybody in business was given the opportunity during 2016 to receive their 'draft business rate RV' and not everyone did that as it would have showed merciless increases for many. My friend did this and we questioned the whole thing last year whereupon the stated RV was reduced from £24500 to £1300 almost 'on a whim'.

The thing is you don't always need to employ a professional agent ( many firms of surveyors are jumping on this on the back of possible large commissions from the savings that you may make ) and you can challenge the VOA on many fronts depending on what your business is, whether you are a freehold or leasehold business property and exactly how they believe your business can be uprated without a shred of evidence on your part. For the time being, you have to argue your own case as I am sure that repeated objections 'en masse' will take a long time to filter through.

In the last two years, I appealed against a council tax banding on the basis that the VOA had revalued the building when it was built in 2010 as a new build and they failed to assess it properly in line with other local, similar properties. I won that case, and repeated it for another ten flats in my block' all being reduced one banding, which in my opinion were still too high but I was grateful for some success after one year. I believe I won that case because I simply stated that the VAO had not acted within their own rulings and it may be necessary to 'take it to law'. They decided that the argument was not worth is and cancelled my tribunal by agreeing a resolution between them and me.

After all, VOA employees are only human, unlike the ridiculous rules that they sometimes have to work under.

And still we remain in recession, regardless of what the media says. You only have to tour the high streets to see how many empty shops litter them, not to mention those that survive have cut prices to the bone. I have had experience with laundries/dry cleaners and they are one of the most difficult businesses to create profit from.

I wish you and your business friends every success with your efforts here. But you have to be bold! Hardship reduction is almost gone nowadays I believe and even the small business rate relief ( which George Osborne said he would increase in 2015 ) has turned out to be a figment of the governments imagination, does I suggest by simply 'moving the goal posts'!