The 2017 Rating List is now less than 2 months away, despite which the mechanics of how to challenge the new rateable values remains unclear. The most significant changes apply to England, whilst Wales has been insulated because Business Rates is a devolved matter. Scotland has always done acted autonomously regarding rates, publishing an entirely separate rating list and having an appeal system with its own nuances. Current indications are that the process in Wales and Scotland will remain close to the existing appeal system, but more of this later...
ENGLAND - CHECK, CHALLENGE, APPEAL
The Valuation Office published the Draft 2017 Rating List on 30th September last year and ratepayers have the ability to request a review of their new valuation prior to the new Rating List coming into force on 1st April 2017.
Government have announced the rate multipliers to be applied to the Rateable Value and a transitional relief scheme which is far less attractive than at previous Revaluations.
The authorities in England are adopting a new system in England from 1st April 2017 and this will be more complicated and time consuming. From April ratepayers will have to complete two preliminary stages, including setting up a Government Gateway account before a formal appeal can even commence.
Draft regulations set out Check Challenge Appeal as a multi-stage, sequential process that requires more admin and information at almost every stage in the process. Ratepayers will risk penalties for knowingly, recklessly or carelessly providing false information. We await the confirmation of Draft regulations but a summary of the current position is set out below:-
Check – An initial stage to review the facts upon which the rating assessment is based with an obligation on the ratepayer to agree or correct the facts. If the Valuation Office accepts these factual changes then then they will amend the Rateable Value. A challenge would still be required to review valuation issues.
Challenge – This second stage will require comprehensive rental evidence and other information and submit a revised valuation. This level of detail is required before the Valuation Office divulge any information whatsoever upon which their opinion of values is based. Following a proportionate response to any evidence the VO will issue a Decision Notice, following which, if the Ratepayer is unhappy with the outcome, they can make an additional appeal to the Valuation Tribunal
Appeal – For the first time an appeal will require a fee, likely to be £300. The appeal will rely largely on the evidence put forward at appeal stage with limited ability to add additional evidence.
The draft regulations also introduce a new concept which will limit the Valuation Tribunal to amending a rateable value only where the valuation is “outside the bounds of reasonable professional judgement” - a phrase that will no doubt take many years of case law to establish the meaning! We await the formal announcement of whether this draconian measure will be introduced.
Properties in Wales are included within the same 2017 Rating List as England.
Welsh Assembly Government has announced the multipliers to be adopted. However, transitional relief will not be applied other than a proposal to phase in liability increases for some small businesses that currently benefit from Small Business Rate Relief.
Appeals will continue to be made to the Valuation Office Agency and if unsuccessful can be progressed to the Valuation Tribunal for Wales. There has been some suggestion that Wales may follow England in adopting CCA but the cost of doing so could be prohibitive.
The new 2017 valuations have been published on the Scottish Assessors’ Association web portal and Scottish Government has introduced the draft budget for 2017/18.
For larger properties the rate multiplier will be higher than that adopted in England, whilst smaller properties will both England and Scotland will have the same multiplier on smaller properties.
There will be NO transitional relief scheme in Scotland.
Appeals in Scotland will still be submitted to the relevant Scottish Assessor and will remain restricted to the first 6 months of the rating list or within six months of a new ratepayer. They will retain the same facility to submit proposals electronically. If Scotland follows its practices from the 2010 list there is likely to be a statutory time limit in which requires all appeals raised within the 6 month time window to be concluded within a set period which was just over 3 ½ years on the 2010 list. This compares with a process in England which could see the first appeals being concluded after 3 years.
The mechanics of exactly how all of this will work remains unclear as the DCLG, Welsh Assembly and Scottish Assessors have yet to issue the appropriate regulations.
On the brink of the 2017 Revaluation ratepayers are faced with significant changes and a lot of uncertainty.