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Check, Challenge, Appeal - the simple sounding concept for a complex new rating system

Oct 5, 2016

The newly proposed non-domestic rating list has now been published for the new rateable values to be introduced from 1st April 2017.

It has been 7 years since values for business rates have been reassessed - and while the previous system for raising appeals had been in place for a significant number of years, it was still heavily flawed with almost 300,000 appeals understood to still be outstanding from the 2010 rating list. 

 

The hope was that the appeals system would be simplified and become more transparent. However, the new “Check, Challenge, Appeal” process that has been proposed is overly complex and is generally considered to be unfair towards ratepayers. Why? Because there is now potentially a 3-year wait before a ratepayer is allowed to make a formal appeal and disincentives for submitting appeals. Essentially, rate-payers will be fined for unsuccessful appeals. This is just one of many challenges facing business owners and rate payers this year, whether for commercial property or otherwise.  

 

The Process

 

Check – Rate payers can agree on facts concerning the property with the Valuation Office Agency (VOA).  

 

Challenge – This stage can only be instigated within four months of the check stage, with a further 18 months allowed to conclude the challenge. 

 

Appeal – Those granted an appeal will have up to 4 months to do so after the challenge stage and must pay a fee of up to £300 which is only refundable if successful. 

 

The previous two-phase system of Appeal and Tribunal has been replaced with a three-phase system, with proposals also suggesting that the Valuation Tribunal would only be able to order an adjustment to the proposed new rates if they are “outside the bounds of reasonable professional judgement”. 

 

The new rateable values will continue to be based on rental values as at the antecedent valuation date (1st April 2015 for the new list) for many property types. There will therefore be an obligation on appellants to provide evidence for reducing the assessment on the basis of value and this combined with the proposed new complex process and potential fines for ratepayers could cause difficulties for unrepresented rate payers making appeals. Care, therefore, clearly needs to be taken and whenever possible professional advice sought.

 

There remains significant objections to the new process from the business community, Chartered Surveyors and rating firms as well as bodies such as the RICS with calls for the Government to reconsider its proposals but at present the new Check, Challenge, Appeal system remains on the table.

 

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