It is often assumed that business rates are only chargeable against property which is run as part of a business, however this is not necessarily the case. Any non-domestic property that falls outside of your residential curtilage may be subject to Non-Domestic rates.
As from the 1st April 2017, the new rates released by the Valuation Office Agency (VOA) will come into effect.
For those rural businesses which have diversified, we would encourage you to check that the rate you are paying is the correct amount, as it has already been identified that some rural businesses may face steep increases.
How do they work?
Business rates are calculated based on the ‘rateable value’ of your property. The VOA have recently undertaken a revaluation and provided a new list of rateable values on 30th September 2016 which are based on the rental value of properties as at 1st April 2015.
The rateable value of your property is then multiplied by the relevant ‘multiplier’ which is set by central government to determine the rates paid.
It is important to note however, that there are certain reliefs available to reduce the amount paid and these are worth exploring. These include;
- Small Business Rate Relief
- Rural Rate Relief
- Empty Buildings Relief
- Transitional Relief
We have recently been instructed on a case where a private American Barn in Herefordshire has been newly listed for the payment of Non-Domestic rates. In cases like these, be careful to make sure that the use of the property has been correctly identified to ensure that the valuation is accurate to reflect each facility or use. Please note that the valuations will differ from area to area and it is worth asking your local Valuer to check you are paying the correct amount.
For example the following average values may be applied to your equestrian property from 1st April 2017;
- Indoor Loose Box: £350/unit
- Outdoor Loose Box: £320/unit
- Indoor Arena: £6/m²
- Outdoor Arena: £1.50/m²
Therefore if a 12’ x 12’ stable is actually used as a store, it should be rated closer to £200 as opposed to £300.
While these figures focus on equestrian properties, the same principle applies to other forms of diversification including;
- Caravan storage
- Farm shops
- Storage facilities
- Holiday lets
- Non-agricultural workshops
Should you believe that the listing or revaluation of your business rates is incorrect, and you are eligible to do so, you may appeal to the VOA on the basis that the rateable value is too high for the property or that the measurable floor area used to calculate your rates is incorrect.