If the new business rates appeals system becomes an obstacle to those already feeling the impact of new business rates, does this mean it is not fit for purpose?
Who benefits from the new appeals system? In the education sector, for example, many schools are already having to weigh up the likely impact of rate rises, and are viewing the new, Check, Challenge and Appeal process with some scepticism.
What is the Purpose of the New Business Rates Appeals System?
As Paul Giness of The Beattie Partnership sees it, “The Government wants to reduce the large number of appeals routinely made against rates assessments but is failing to offer a sufficiently user-friendly alternative.”
“There are regular news items about the significant backlog of outstanding appeals” Paul comments, “which shows that the system needed a shakeup, but is this the answer?
“One of the reasons so many people have routinely appealed against their valuation is because the system lacks transparency.”
Check, Challenge and Appeal
The new, Check, Challenge and Appeal system puts the burden of proof firmly on the ratepayer:
- Check: At this stage, the ratepayer will have one opportunity to validate the facts in the entry by the Valuation Office Agency (VOA). At this stage, it is up to the ratepayer to agree with the facts or make corrections.
- Challenge: The ratepayer can then only start the Challenge process within four months of completing the Check, but it can take up to 18 months to conclude, meaning the whole process, up to the VOA’s decision, is lengthy.
- Appeal: Following the VOA’s decision, there is another four-month period in which the ratepayer can make a formal Appeal.
“For the Challenge, the ratepayer must give substantive reasons,” Paul explains, “and must provide comprehensive supporting evidence. The VOA also requires that the ratepayer submits an alternative valuation.”
“Again, time is marching on, and the business rates appeals process is costly. Furthermore, the VOA will base its decision on evidence already submitted, not on new material,” Paul says.
The Implications for Schools
“Schools are already bearing a heavy burden. Some face budget shortfalls, and stretched administrative resources. The complex, drawn out, and potentially costly, new appeals process will not help”
“There might be some light, however, as factual errors by the Valuation Office under the new Check system should be dealt with quicker than the more cavernous everlasting appeals process on previous Lists,” explains Paul.
In addition, leading education rates specialists, including The Beattie Partnership, are anticipating some headway can be made with Specialist Valuation Officers to tackle the underlying valuation basis within the Practice Note, to reduce the scale of increases facing independent schools.
Paul’s advice to schools is to be aware and be prepared when it comes to business rates.
“Make sure you have the right level of professional representation, and, most of all, be proactive about your rates. Act now, look at your expenditure, check the facts, your building use and state of repair. The valuations can be very complex for independent schools and its often advisable to seek professional advice to determine if an approach is recommended to the Valuation Office for a Check and Challenge.”
If you have had a business rates rise and would like to discover more about checking, challenging and appealing it, please call The Beattie Partnership, now, on 0161 228 2224.