Business rates demand notice - court

[peter.k]

Re: Business rates demand notice - court

Huge thank you for support Minoro.

Does that mean you and your partner own the building personally or through another entity (Ie. Pension, other Partnership/Ltd Company?). - no our company and ourselves were renting property from one landlord and then from another (building was sold after 2 years of us renting). After we sold our company, new owner got his own lease in his name from Landlord.


You mentioned the Rates Demand and Summons are in your name. Was the original bill back at the time in your name or the (now defunct) company? - The main issue here was that we never ever received any Business rates notices from council for all 3 years company was trading. We only paid building rental, bills, etc but not business rates.

[Minoro]

Re: Business rates demand notice - court

Phew! The fact that you rented the property at "arms length" removes all sorts of potential grey areas!

The fact that you never received bills at the time does not mean they were not raised, nor that you do not now owe the money (there is no Statutory Time Limit on local taxes). Remember, in the last couple of years (assuming you are England based) the Councils have changed form just being a "billing and collection agent for Business Rates" for HM Treasury to being able to keep all Business Rates receipts. However, they lose their central Government grants and are generally worse off for it, so they are now actively pursuing old debts they forgot about at the time, and looking for all sorts of potential buiness rates revenue that may not have mattered too much before - looking thorugh old debts, hunting for business premisess that weren't paying rates before et al. This is what you seem to have got caught up in, and anecdotally they are playing both hardball and stupid at the same time to try to get you to think "it's less hassle just to pay". I have one client who says the Council admitted contacting a Mezzanine Floor Company for details of their clients, and getting the VOA to increase Rates Valuations based on this information about extra floor space - resulting in a big backdated hike in my client's bill!!!

Anyhow, back to the specifics of your problem. You need to ensure you have copies of the orginal bills, whenever they were raised, and what information they used to decide to put your name personally on them. There is normally a form you need to fill in when you first move in with the details of who (ie. legal entity) occupies and should be billed. If you didn't do that then it may be in your case that they got inaccurate information from the Landlord or the subsequent business owner which should be corrected. Back this up with a lease showing the Ltd Company as the occupier, and that should put things right. Note that even if you provided a personal guarantee for the lease, it does not necessarily mean you are liable for unpaid business rates.

I appreciate that you may have jumped through these hoops already with the Council directly by phone and email to no avail, but it will be a different matter if you have asked (as several of us have suggested) that you are heard before the Magistrate and not by the Council in the room they have rented form the Court. They will then be obliged to run this through their legal people who will need to potentially represent them at the adjourned Hearing, and suddenly they get more straight forward to deal with! The adjournemen should be granted to allow them time to provide you with the information you would rightly request to take legal advice upon.

Don;t be afraid going to Court. The coffee is generally bad, but the help of the Court Ushers is great and you'll probably find the main Council representative is more helpful than their minions have been back at the office in the past. But do stand your ground regarding a hearing before the Magistrate, and requesting an Adjournement to allow the Council time to provide the paperwork supporting their claim.

[peter.k]

Re: Business rates demand notice - court

Once again huge thank you for explanation Minoro!

The issue i see here is that for the first year our rental agreement was between landlord and our company. But for the second year (while landlord was selling his premises) our rental agreements were signed for 3 months only and was between Landlord and ourselves (both names of the partners). And we have 5 of such Lease agreements, extended after every 3 months. That was done simply because Landlord got scared that our company might move or refuse to pay rent before he has sold the building. And we were stupid to sign it (lease agreement was signed between Landlord Ltd and Peter xx and Martin xx, trading as XXX Ltd).

[Minoro]

Re: Business rates demand notice - court

Hmm......

Might be little more of an issue then, although "trading as XXX Ltd" is a bit of a legal contradiction as "XXX Ltd" actually exisited as a Limited Company. I'm only thinking out loud here, but it may that this creates enough doubt as to who the lease was actually entitling occupation to, and if you have utlity bills or regular supply invoices to the limited company at the property address then it may be enough to prove the ambiguity in the lease is just that, and the limited company definately occupied. Again - request to be in front of the Magistrate and seek an Adjournment whilst you take advice is still the best solution expalaining that this issue was never raised at the time of the alledged debt and only long after you left, leaving you needing time to get the facts together- but have those Utility Bills etc. with you when you go this time just in case.

Outside of the box for a minute, do you know what the Rateable Value was on your property? If it's not on any correspondence you have (it is normally only on the actual annual rates demand) you can find it online - google "valuation office agency" to get you to their bit of gov.uk and you can do a postcode search to find out. If it is less than £12,000 for that period (and assuming a few other things like your business didn't occupy a second property bigger than a shed), then they may be significant Small Business Relief you can apply for retrospectively (as they only billed you retrospectively from how I ready your posts). This is 100% relief at £6,000 RV and below at the time of the alldged liability (ie. nothing due!). I only suggest it because nine times out of ten when my clients don't get billed for rates its a very small property involved. Just a thought and it may be too late to apply etc., but you never know.....

I think you do need to buy time if you can, and then get some professional advice. The key is to be as big a pain in the rear to the Council as they are being to you. Sometimes they just move on to the lower hanging fruit.

[peter.k]

Re: Business rates demand notice - court

Thank you for more information Minoro.

I do have a few electricity and water bills in the name of our company in my possession which i will take with me.

Rateable value of our garage was 9,600 per annum.

[Minoro]

Re: Business rates demand notice - court

"Per Year" confuses me - RV's are not changed annually. If £9,600 is the Rateable Value (RV) of the property for the 2010 Rating List, and not the current 2017 list, nor the actual rates bill per year (£9,600 x 0.42ish), then you would have probably been entitled to a 40% reduction in actual cash liability (to make your actual annual bill for the period they are asking for reduce from around £4,032 to £2,419). If you picked this up from just some correspondence then I would suggest just following the advice before to find your valuation on gov.uk and look under the "Previous Valuations" tab for the 2010 RV (self-explanatory when you are on there). Forgive me if I seem to be teaching my grandmother to suck eggs, but I don't know how much you know...!

Worth a call to the Council to ask about retrospective application of Small Business Rates Relief as the liability was retrospectiovely billed for. The lower the actual amount owed the less effort they may make to collect it, and It's another reason to get an Adjournment whilst the Council rebill you the correct amount. Small Business Rates Relief requires a single page form to apply for usually downlaodable form the Council Website. It won;t be done before the Hearing tomorrow but worth the call today to mention it tomorrow.

Good news on the utility bills. I'd just keep schtum/plead ignorance on the lease being "MR X and Mr Y trading as ZZZZ Ltd", just explain as far as you are concerned that means ZZZZ Ltd which yoiu took it to mean in any case. Your Landlord didn't do a good job of protecting himself I have to say!

Best of luck tomorrw - don't take any advice for the Council about how to go about things there if it means you signing anything or agreeing to anything other than a Hearing in front of the Magistrate and an Adjournemnt. Sneeky buggers they can be sometimes - "oh just sign here or let me fill in this form and we'll arrange it all" that kind of BS. Unusal but not unheard of.

[peter.k]

Re: Business rates demand notice - court

Hello once again Minoro.

Yes, you are right - all bills states £9,600 rateable value. It was me who added "per year".
Sorry, not sure about all other information and discounts you have mentioned. Where do i go and do what?

Currently they are only chasing for rates for 3 months only, but i suspect more bills will follow after the Court hearings.
Also - court is on Wednesday, so have additional day tomorrow to get myself ready for it.

[Minoro]

Re: Business rates demand notice - court

OK. On your local council website business rates pages there will be an explaination of how Small Business Rates Relief works. It's fairly straight forward but would take too much space to explain here! It will explain the current rules (since April 2017) rather that the slighlty different rules for the period they are chasing you for (these days anything under £12,000 RV is 100% relief, with 1% coming off that for every £30 above £12,000. When you owe for it was 100% under £6,000 RV and 1% less discount for every £60 above £6,000. Take my word for it - you are entitled to 40% SBRR on your RV if you had no other business property at the time. A "general" call to the Council will confirm this for you.

However, now I know they are only chasing three months it will not make a huge difference (£600 instead of £1000 approx plus costs), and it is not the main argument. The whole SBRR thing was just a thought because I understood they were chasing three years of business rates! Don't get bogged down too much with this

The main argument is that the Ltd Company owe it and not you - and that Ltd Company no longer exists. Proof that the Limited Company owe it is by way of your lease and the utility bills which back up that the Limited Company was the occupier at the time (and therefore the entity resposnsible for paying rates).

As it is only for three months of liability - check EXACTLY which three months (should be on the bill and the summons). It may be you were not even there then and it was empty after the next owner left - all sorts of mistakes are made by Councils along these lines and they tend to chase the last man standing (or the only one they can find!).

So don;t get overly concerned with SBRR, and concentrate on the facts as to who was responsible for payment. Also don;t worry about other periods they may claim for - put this one to bed and they won't be chasing you!

[peter.k]

Re: Business rates demand notice - court

Morning all,

Have attended a court this morning and got my "case" moved to January. Court Usher still insisted that i will still have to pay and delaying it wont change much but as i kept disagreeing this got moved to a later date. Not sure if it will help me much do..

[peter.k]

Re: Business rates demand notice - court

Hello again.

Received a letter from council confirming cancellation of court fees. However - they still demand a full payment and threatening me with a fresh court letter if i dont pay before 31/12...